Bangalore: Wipro Infotech, the domestic IT service arm of Wipro, today (Dec 14, 2004) signed a seven-year deal with private sector YES Bank to outsource the technology requirements for the bank, which aims to grow to 400 branches during the period.

"This is the first significant, complex outsourcing deal in Indian banking sector," Wipro Chairman Azim Premji told reporters after signing the deal with YES Bank's MD and CEO Rana Kapoor at Wipro's office on the city outskirts.

Both Premji and Kapoor declined to comment on the value of the deal with the Wipro Chairman, saying, "We don't want to un-bundle the price for competitive reasons".

YES Bank, which began operations in August this year, Kapoor said, would save about 30 per cent in total costs, due to outsourcing the IT infrastructure, instead of running it in house.

"We plan to start between 12 to 30 branches in the next 12 to 18 months, increase it to about 100 by 2008 and 250 branches in 2010, assuming that the growth is purely organic," he said.

Kapoor said the ATM infrastructure is being outsourced to another firm, while the core banking solution for its bank is from i flex Solutions.

"We will have about 25 people working initially which will be ramped to over 75," Wipro Infotech President Suresh Vaswani said, adding, that Wipro would be the preferred partner for servicing all future technology demands of the bank.