Bay Networks signs major networking pact with Chase Manhattan.

SANTA CLARA, Calif.--(BUSINESS WIRE)--Nov. 7, 1994--In what can be considered the single largest intelligent hub deal in its history, Bay Networks Inc., Monday announced it has been chosen by Chase Manhattan Corp., one of the world's leading trading institutions, to provide networking products for a multiyear, multimillion dollar project to re-engineer Chase's worldwide trading floor network.

Under the agreement, Chase will install Bay Network's Lattis System 5000 intelligent hubs in the data centers that control all trading floor transactions. In addition, Chase has standardized on Bay Networks Optivity network management system to manage each of these networks throughout the world.

The new trading floor project begins with the installation of approximately 100 System 5000 hubs in Chase's New York facility, and will roll out similar networks in London, Tokyo, Hong Kong, Singapore and Sydney over the next few years. Chase estimates the entire cost of building and equipping its New York trading floor with hubs and all other information technology systems to be worth $95 million.

The deal reflects a growing trend among Wall Street firms to leverage new, high-speed networking technology to optimize global trading operations. Using this technology, these firms can increase trading volume and significantly improve customer service by providing dealers around the world with up-to-the-minute access to a variety of voice, video and data-based market information services.

"Chase Manhattan chose Bay Networks products because they work together to provide a reliable, flexible, extensible network," said Bill Schimoler, vice president of trading technology for Chase Manhattan. "This network enables us to grow our businesses while serving our customers better."

Using Networks to Improve Service

With the old system, some trading floor dealers manually tracked and shared information such as customer orders and rates because the network was not powerful enough to support the volume and pace of activity. With a network based on Bay Networks hubs, all dealers will now be able to track currency rates, analyze data, capture transactions and make quicker decisions using information available at the desktop.

One example of a networked trading floor application is the Leave Order Processing system, in which customers leave information for exchange orders that must be placed at a later time when currency rates reach a certain price. By entering the order in the new system, the dealer is automatically alerted when it is time to make a purchase.

The new trading floor network vastly decreases the potential for lost orders. This translates into increased trading volume and greater profitability.

The Heart of the Network

Chase's New York facility will consist of almost 100 Ethernet LAN segments, connecting more than 540 end stations. An FDDI backbone connects all of the segments. Each trading floor dealer is equipped with a personal computer, a Sun Microsystems workstation and often a video monitor for tracking up to 300 simultaneous lines of incoming data.

To conserve space on the trading floor and ensure greater security, the System 5000 hubs will reside in the data center and provide the reliability and flexibility that Chase requires. Bay Networks' Optivity network management system allows a small staff to perform remote diagnostics and network configuration, as well as to simplify dealer moves, adds and changes on the trading floor.

"We typically move 50 dealers each month around the trading floor. This new system will drastically reduce the cost involved in managing these moves," said Schimoler. "But even more important than cost is the ability to accelerate response time and get the moves completed as quickly as possible."

Interoperability was also a deciding factor when selecting an intelligent hub vendor. Because other divisions of Chase Manhattan use intelligent hubs from other vendors, the trading floor project had to install standards-based hubs that could communicate with other systems.

Planning for the Future

The next phase of the trading floor project is to build similar networks in various sites throughout the world. Chase Manhattan is also seriously considering high-speed switching technologies such as 100BASE-T Fast Ethernet and ATM for the future.

"We needed an intelligent hub that provided an upgrade path for new, advanced technologies as our applications require it," said Schimoler.

The Chase Manhattan Corp., with $114 billion in assets and a presence in more than 50 countries, is a diversified global financial services company with a consumer products franchise in the United States and a branch banking network in the northeastern United States.

Bay Networks Inc. (NASDAQ:BNET) is a leading worldwide supplier of network services and products such as high-end routers, wide area network access devices, local area network switches, intelligent hubs and sophisticated management software.

These products provide local and wide area network connections for organizations building both small, local area networks and large, enterprise-wide information networks. Bay Networks was established in October 1994 upon the completion of the merger of Wellfleet Communications and SunOptics Communications, and has combined revenues in excess of $1 billion for its most recent reported four quarters.

CONTACT: Bay Networks Inc., Santa Clara

             David Callisch, 408/764-1347
             Susan Ice, 408/764-7360
             Chase Manhattan
             Bradley Pick, 212/552-7403