NASD and EDS Form Strategic Relationship
NasTech Agreement is First of Its Kind in Securities Industry
Washington and New York—The National Association of Securities Dealers, Inc. (NASD®), announced today that it has signed an agreement with EDS to provide state-of-the-art technology services for the NASD and its subsidiary, NASD Regulation, Inc. This relationship, referred to as NasTechSM, will enable the NASD to further extend its world-class regulatory and supervisory activities for the global investor community.
The agreement is the first of its kind in the securities industry and will help the NASD realize over a half billion dollars in cost reductions over the life of the 10-year, $1.5 to $2 billion contract. More than 350 information technology professionals currently employed by the NASD will join EDS. EDS will manage another 350 third-party consultants as part of NasTech, which will be headquartered in the NASD’s Rockville, Md., technology center.
"NasTech will build on the technological innovation for which the NASD and NASD Regulation are known and will create a new standard for the securities industry," said Gregor S. Bailar, executive vice president and chief information officer of the NASD. "We are especially pleased to team with EDS, a recognized leader in electronic business and securities technology. Our relationship will provide a new foundation on which the NASD will continue to expand in the years ahead."
Mary Schapiro, president of NASD Regulation, Inc., said, "Effective regulation is the basis for an orderly market and technology is at the heart of our regulatory organization. Teaming with EDS is key to helping the NASD continue to be a world-class regulator."
"As converging world markets become more interdependent, regulatory safeguards that extend beyond geography will help to preserve the security and integrity of the capital markets system," said Michael T. Reddy, president of EDS’ Global Financial Markets Group.
"NasTech will free the NASD to extend to the global investment community its vision of protecting investors, member firms and listed companies."
EDS senior vice president Coley Clark, added, "This relationship sets a new pace and standard for EDS. It is an opportunity to reclaim the IT services industry that this company invented. It is also an opportunity for the NASD to continue defining the shape and direction of the securities industry."
EDS will be responsible for applications development and maintenance, Internet and Intranet development, Web hosting, and distributed systems support, among other programs. In addition, NasTech will manage the NASD’s ongoing vendor relationships. EDS will manage NasTech’s day-to-day activities and report to the NASD executive management.
Operations and technology of another NASD subsidiary—The Nasdaq Stock Market®—are not included in the agreement.
EDS, a leader in the global information technology services industry for more than 35 years, delivers management consulting, electronic business solutions, and systems and technology expertise to improve the performance of more than 9,000 business and government clients in about 50 countries. EDS reported revenues of $16.9 billion in 1998.
The National Association of Securities Dealers, Inc. (NASD®), is the largest securities-industry, self-regulatory organization in the United States and parent organization of NASD Regulation, Inc., and The Nasdaq-Amex Market GroupSM. NASD Regulation, Inc., oversees the nation’s 5,600 brokerage firms and more than half a million stockbrokers for the protection and benefit of investors. For more information, please visit www.nasd.com.