Press Release

Three Federal Home Loan Banks Tap BankServ To Provide Automated Wire Transfer Services

December 05, 2001 - SAN FRANCISCO, CA — Three of the nation's 12 Federal Home Loan Banks have elected to license automated wire transfer software provided by a San Francisco-based private electronic payments processor. The three home loan banks — located in Indianapolis, Boston, and Seattle - have selected BankServ to provide their automated wire transfer services using the company's Global Funds Exchange (GFX) system, BankServ said today.

Two of the Federal Home Loan Banks — in Boston and Indianapolis — went "live" with the new BankServ wire transfer services in the second quarter of this year, according to Randy Gutierrez, BankServ chief technology officer and general manager, wire transfer services. He said the Federal Home Loan Bank of Seattle is expected to implement the GFX system this week.

BankServ (www.bankserv.com) is one of the nation's leading providers of Federal Reserve Wire Network (Fedwire) and Automated Clearing House (ACH) electronic payments processing for financial services companies and businesses. The company recently announced that it had crossed the trillion-dollar mark in processing Fedwire transfers since the company began five years ago.

Gutierrez said that the FHLB system has special needs, since it provides funds and other products to banking institutions to make loans for homes and businesses in their local communities. "The Federal Home Loan Banks need to settle the transfers of hundreds of loans every day," he said, "often in a paper-intensive environment. GFX helps to ease the banks' paper burden and to consolidate dozens of databases of information on incoming and outgoing wire transfers. They know that, with GFX, funds are moved cost-effectively, in keeping with federal guidelines, and using highly secure technology."

Lisa Chilcote, assistant vice president/cash manager, FHLB of Indianapolis, agrees, pointing out that "Federal Home Loan Banks use wire transfers to move millions of dollars of funds for our member institutions every day to finance residential and community loans. BankServ's GFX system provides the detail, flexibility, and screening capacity we currently require in a wire transfer software system."

The Boston FHLB serves the six New England states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. The Indianapolis FHLB serves the states of Indiana and Michigan. The Seattle FHLB serves the states of Alaska, Hawaii, Idaho, Montana, Oregon, Utah, Washington, Wyoming and the territories of American Samoa, Guam, and the Northern Mariana islands.

BankServ's GFX automated wire transfer solution currently is used in the U.S. by more than 30 financial services holding companies, representing more than 100 banks and credit unions, to move nearly $3 billion each day through the Fedwire system, adds David F. Kvederis, president and CEO of privately held BankServ. More than a million Fedwires a year and nearly two million electronic checks (eChecks) a year are now processed by the company, he notes.

U.S. financial institutions executed $380 trillion of wire transfers over Fedwire last year, according to the Federal Reserve Bank (http://www.federalreserve.gov/PaymentSystems/FedWire/annual.pdf). Electronic fund transfers of more than $10,000 are regulated by the federal Office of Foreign Asset Control (OFAC), the U. S. Bank Secrecy Act (BSA), and the Federal Reserve Bank.

"Considering the huge volume of wire transfers executed by the Federal Home Loan Banks, strict adherence to government guidelines on money laundering and record keeping take on even greater significance where asset and funds movement can reach any domestic or international destination in the blink of an eye," Kvederis said. "Using GFX is particularly reassuring to our bank customers because it affords the tightest controls over the movement of electronic funding."