By Sullivan, Deidre
American Banker , Vol. 158, No. 59
WILL THE FUTURE of applications development look like magic?
Executives at U.S. Trust Corp. in New York City would have to say yes.
The bank, with $227 billion in assets under administration, specializes in money management, private banking, and securities services. Whe faced with the task of developing a mutual fund accounting system, it decided to experiment with a new application development tool called Magic Software.
"Mutual fund accounting is a highly specialized, exacting business," said Bernard Edelstein, a senior vice president and director of computer services at U.S Trust. "We were faced with a situation where we needed to create our own system because typical porftolio systems lacke rigorous accounting components and simply didn't fit our needs."
Using Magic's design tools, the mutual fund accounting system was up and running within six months. The service, marketed under the name MultiFact, currently handles processing chores for more than 200 different funds.
Since the mutual fund accounting system was launched three years ago, U.S. Trust has sold services based on the new system through its Boston-based subsidiary, Mutual Funds Services Co.
U.S. Trust is one of the first American banks to take advantage of the Magic design tools, which were developed by Magic Software Enterprises, an Israeli firm with U.S. offices in Irvine, Calif.
In addition to U.S. Trust, a range of international organizations, including the Bank of Tokyo and the French government, are using systems based on Magic development methods.
Mr. Edelstein estimated that if the bank had used traditional programming languages, it would have taken more than two years to achieve similar results.
Proprietary systems development particularly at an institution of this size, can be tricky. Most programmers used third-generation languages, namely Cobol or "C," or fourth-generation languages such as Progress or Oracle.
Whatever the method, writing code is a tedious and time-consuming task. Creating or re-writing applications using traditional systems development tools often takes years.
U.S. Trust developers were able to work so quickly because Magic's method is codeless, meaning they were freed from actually writing the hundreds of thousands of lines of code necessary to complete the application.
Magic is also relational, so that once a change is made to one part of the application, the entire system is updated, again saving time that used to go into writing code.
"The problem with many custom development projects is that by the time the technology is up and running, it's sometimes behind the curve," said Mr. Edelstein. "We couldn't wait that long for a new system because we saw an opportunity to sell fund accounting services, which are a necessary complement to our existing lines of business."
One of the key challenges facing U.S. Trust developers was creating an accounting system that was expandable.
"This business is dynamic, with new types of instruments entering the market all the time," said Mr. Edelstein. "We needed a system that could grow as we grew our business."
In addition, the system had to be able to tie into a variety of on-line services, from trust accounting and securities processing components to porfolio management and pricing services.
Because Magic automates most common data base operations, including file processing and screen preparation, U.S. Trust developers were able to focus on strategic issues, application functionality, and end-user requirements. …