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National Australia Bank suspends new Satyam contracts

National Australia Bank suspends new Satyam contracts
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First Published: Thu, Feb 05 2009. 05 13 PM IST
Updated: Thu, Feb 05 2009. 05 13 PM IST
Bangalore: National Australia Bank has decided to suspend new outsourcing contracts awarded to fraud-hit Indian outsourcer Satyam Computer Services, a spokeswoman for Australia’s largest lender said on Thursday.
NAB said Satyam was now in a period of stabilisation and continued to meet existing service level commitments and contractual obligations towards the bank.
“It has been decided that application development and maintenance work transitioned to Satyam in 2007 and 2008 will remain unchanged,” the spokeswoman said in an e-mailed statement to Reuters.
“However, until the longer-term future of Satyam becomes clearer, NAB will suspend all work currently in the early stages of transition to Satyam,” she said.
A spokeswoman for Satyam said the outsourcer and NAB officials had addressed their respective staff earlier in the day to announce the suspension of the new projects awarded to the Indian firm a couple of months back.
Satyam continued to work with NAB on existing engagements, she said.
Last month, Satyam said US-based State Farm Automobile Insurance had terminated its outsourcing contract.
Satyam has been battling for survival since Ramalinga Raju resigned as chairman on 7 January, revealing profits had been overstated for years and that $1 billion of cash and bank balances on the company’s books did not exist.
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First Published: Thu, Feb 05 2009. 05 13 PM IST
More Topics: Satyam | NAB | Contracts | Technology | Ramalinga Raju |