The growing need for a public service efficiency charter

By Gerry Weeraratne

There is a growing international trend for governments, in both developed and developing countries, to focus on the need to provide greater value for money in the delivery of public services. With this trend has come an awareness that public services must improve the quality of service provided to their customers, citizens, tourists and visiting businessmen and women.

If Sri Lanka is to prosper, we too must show our commitment to improving the quality of service delivered to all who live in or visit our country.

Such efforts must of course be part of a wider programme of reform to provide efficient, effective and economic public services.

The Charter concept

With this in mind, most countries have developed what is commonly referred to now as a charter programme. This is in several countries established as a unit or section or a department positioned at the highest level of the central government e.g. in the office of the President or Prime Minister to monitor and assist efficient public service delivery. In some cases charters are even published for specific functions currently undertaken by Government, in addition to a general public service charter.

It is also interesting that in certain countries, para-statals and the private sector have followed Government's example in following the charter practice to provide an efficient, cost-effective and consumer-focused delivery of their services.

If the delivery of public services are efficient, cost-effective and customer-focused Sri Lanka can be a country that we can all be proud of.

An Efficiency and Charter Unit should be established at the highest level of civil administration preferably at the office of the President. Below are quotes from 3 such charters, one from a developing country, (Namibia) and two from UK and the USA.

Public Service Charter- General Principles (As adopted by the Namibian Government) Standards

Setting, monitoring and publishing clear standards of service that individual members of the public can reasonably expect.

Accountability

Providing details of performance against targets and identifying who is responsible.

Information

Providing information about public services in a straightforward and open manner which is readily understandable.

Openess

Disclosing how public services are managed and the cost and performance of specific services

Courtesy And Helpfulness

Providing a courteous and helpful service which is run to suit the convenience of those entitled to the service: services being provided by public servants who can be identified readily, through wearing name badges by their customers.

Non Discrimination

Ensuring that services are available and applied equally to all.

Consultation And Choice

Ensuring that there is regular consultation and communication with those who use services and having taken their views and priorities into account, providing a choice where-ever possible.

Quality Of Service

Publicizing straight forward complaints procedures with independent reviews. Where errors have been made, an apology, full explanation and early correction of the error.

Value for money

Providing efficient and economic public services within affordable resources.

It is to be noted that the Public Service Efficiency and Charter Unit in Namibia is lodged with the office of the Prime Minister, who is the Head of Government and is responsible to him.

The UK charter programme

The UK Government recognised the need for a charter programme quite early and last year David Clark, the Cabinet Minister for Britain's public service said in a foreword to the publication" Service First - the new charter programme" as follows:

"We believe that people have a right to good quality, convenient and responsive services: to services that are co-ordinated and use modern methods and new technology:

to services that focus on the customer, and give help to those most in need of it fairly and effectively."

The aim of the British Charter programme is to help public services deliver a better society for their citizens. They also set out nine principles for public service delivery as follows:

1. Set standards of service.

2. Be open and provide full information.

3. Consult and involve.

4. Encourage access and promotion of choice.

5. Treat all fairly.

6. Put things right when they go wrong.

7. Use resources effectively.

8. Innovate and improve.

9. Work with other providers.

Hand in hand with the new Charter programme, several governments also proceeded on the global path of privatisation and commercialisation. 76% of the former British Civil Service is now working on a commercial profit oriented approach. Under what is described as the "next steps" programme, former Government departments are now functioning as economic or commercial entities re-structured to perform on the lines of sound business principles.

A further development today is the "outsourcing" or contracting out of government functions and activities. Sri Lanka must also take stock of these developments and try to concentrate on providing only the "core" activities efficiently. Any activity that is not core to the business of Government can and must be contracted out or commercialised.

The American approach

A few years ago President Clinton appointed a Federal Benchmarking Consortium team to undertake a study to provide a customer driven, strategic planning approach to establish standards to serve the American people better. Best practices were detailed in developing a customer-driven strategic planning exercise by the Federal Government to serve the American Public. Vice President Al Gore suggested that government must adopt and provide what he called the "Best in class" performance standards to serve the people. The American government through a report commissioned by the President which was called the National Performance Review goes even further. The guiding principle stated by the President is that the Federal Government must be customer-driven. All agencies of government were asked to develop customer service standards and an Executive Order was given to effect this " customer service revolution " as he called it to change the way the Federal Government does business. The result of this order was that Government Agencies assembled teams from their headquarters and their front office who were prepared to publish their service standards. The end result today is that standards have been developed and published by the American Government to all customer groups.

How can a Charter be introduced In Sri Lanka

Whilst many reasons exist, particularly the cultural and bureaucratic baggage inherited and almost cemented into civil service traditions which may impede the transmission to a customer-driven service, several approaches to introduce and implement an efficiency charter must be taken.

The first obvious pre-requisite is a process of culture change whereby the civil service mentality must be transformed to a business culture which must be totally customer focused. Top Management in Ministries for example should learn how to identity and serve both their internal customers (departments) and external customers (the general public). The second pre-requisite is the commitment of Government leadership to the introduction and maintenance of the charter programme. As stated earlier, the responsibility must be vested at the highest level i.e. the office of the President.

The change of the largely bureaucratic nature of the civil service can be achieved through a process of training. Perhaps MARGA institute could act as trainers, catalysts and mentors to instal a charter programme. They could use the services of qualified consultants in the field to assist them.

A core group of senior public servants, perhaps at the Secretary level, and who have some years of service left should be trained to staff the established Efficiency and Charter Unit.

Finally groups of top management should go on a study tour countries that have a charter programme to see how it has been done and the tangible efforts obtained. In conclusion, one must realize in Sri Lanka that the costs of the public service are mainly borne by the user i.e. the tax payer. They have the right to expect the Government to put the customer first as a service provider.

They have also the right to openness, to quality and to the highest standards by the provider. Finally they have the right to demand to know the cost of services provided and accountability for the use of resources which belong not to the government of the day but to the nation. Let us hope, as indeed I am convinced it should be, that a charter programme will soon be introduced in Sri Lanka to provide the most modern and the highest performance standards of public service delivery.

Code for fair advertising

By Mel Gunasekera

Leading advertising professionals are campaigning to introduce a code of ethics and professional practices to regulate the quality and volume of advertisements in the electronic and print media.

The lack of proper advertising laws have led to heavy advertising or 'commercial abuse' of the media which could have a negative impact on the public and be counterproductive, advertising officials say.

While the state run SLBC, Rupavahini and ITN have their own standards, there were no such standards for the newly established private electronic media. On the other hand, the print media has no such control, officials say.

"It's a free for all out there," says Nimal Gunawardene, President Association of Accredited Advertising Agencies (4A's).

He says that other than an expectation there was no compulsion for the private electronic media to follow the state media.

"While there is an urgent need to come up with a code, our association (4A's) is in the process of drafting a voluntary code of best practices which will spell out a fair way to advertise," he said.

In the USA for instance, an advertiser can name a competitor, that kind of openness is permitted here as well, but on a small scale.

Gunawardene says that under international norms, an advertiser cannot attack another competitor or compare himself unless he has substantial evidence to do so. "This is not happening here which in turn gives competitors undue focus and is counter productive and continues to ignore the consumer."

Gunawardene says that the recently established 4A's has set up a committee on professional best practices and a code of ethics which has been given standards.

Committee member Herman Gunasekera CEO Creative Services says that the code would be of a voluntary nature. The next stage would involve initiating a dialogue with the media.

Gunasekera says that the public has lost respect for the the ad industry due to untrue messages being put out and heavy commercial advertising during peak times.

He says that in other countries, the ad laws stipulate that testimonials can be given only by a user. The person endorsing the product needs to have some evidence that they are using it, here it is not done.

Even in commercials the standards stipulate that a product can be mentioned only a certain number of times. For instance SLBC insists that a product can be mentioned six times in a 30 second spot.

Even commercials could be voiced by approved voices selected by a panel at SLBC. Now the picture has changed with the private channels openly violating these standards.

With intense competition among the top agencies for a slice of the niche top corporate advertising accounts, there is a need to draw up set standards.

The initial exercise is self discipline and perhaps agencies themselves can set their own arbitrator. Presently they can object through the media that is broadcast or resort to legal action, he said.

Sri Lankan consumers are also exposed to about 800 television commercials per week, whereas in other countries this figure was very much lower.

With several private networks competing for a piece of the estimated Rs. 3 billion annual ad-spending in Sri Lanka, TV viewers in particular have been complaining of too many advertisements intruding into programmes, especially at prime time.

Unless television stations cut their ads to about 400 per week, commercial spots would have a negative impact on the viewer and the purpose of advertising would be lost.

Meanwhile the International Advertising Association (IAA) Sri Lanka chapter is also pushing for the advertising content of the print media to be reduced as well. Currently Sri Lankan newspapers are believed to carry more than 50 per cent advertising content at times, while international standards require newspapers to have 60 per cent editorial content against only 40 per cent advertising. The IAA has also invited the Audit Bureau of Circulation (ABC) to be set up here. ABC will initially certify newspapers, periodicals, and later move on to the electronic media.

Should auditors be regulated?

By Dinali Goonewardene

Accounting circles are abuzz with speculation whether auditors compliance with auditing standards can be monitored by the Sri Lanka Accounting and Auditing Standards Monitoring Board (SAASMB).

At present members of the board have diverse opinions regarding this and will seek the views of the Attorney General to resolve this matter.

"There were two views expressed by the members of the board. One that the board is empowered to monitor compliance with Auditing Standards only when there has been non compliance with Sri Lankan Accounting Standards," Director General, SAASMB, Ajith Ratnayake told The Sunday Times Business. "The other view was that the board is empowered to monitor compliance with Auditing Standards irrespective of whether there has been non compliance with accounting standards," he added.

"The board is interested in finding the interpretation which best describes the intention of the legislation," Ratnayake said, referring to the Sri Lanka Accounting and Auditing Standards Act of 1995 by which the board is governed.

The board previously referred the issue to the Attorney General who said the SAASMB was empowered to monitor compliance with auditing standards irrespective of whether there had been non compliance with accounting standards.

However, this decision was not acceptable to the Institute of Chartered Accountants, who sought the opinion of Presidents Council, H L de Silva and Chanaka de Silva. Mr. H L de Silva was of the opinion that the SAASMB is not empowered to monitor compliance with Auditing Standards.

The Sri Lanka Accounting and Auditing Standards Act of 1995 refers to Specified Business Enterprises as being under the purview of the board and this does not include auditors, former President of the Institute of Chartered Accountants and Partner KPMG Ford Rhodes Thornton and Company, Reyaz Mihular said.

"If there is non compliance with accounting standards and the auditors gave their certification the monitoring board can ask how," he said. "If somebody doesn't like our face they can say I think they didn't do the audit properly and auditors will have to spend all their time justifying themselves," Mr Mihular said, referring to a scenario where the monitoring board is permitted to bring to task auditors for non compliance with auditing standards.

He said that an auditors decision to classify some areas as high risk was judgmental and people might not understand this although other auditors would understand the reasoning behind the decision.

He said that auditors should be judged by their peers, just as lawyers are struck off the role by the bar council.

However, in the USA if auditors are found acting negligently the Securities and Exchange Commission (SEC) can debar them from auditing listed companies. The SEC in Sri Lanka is not vested with this power.

However, the Institute of Chartered Accountants which formulates Auditing Standards is a body incorporated under an Act of parliament and has the power to fine or debar members. It has its own mechanism for ensuring professional conduct and a committee of inqury has been set up to investigate anomalies.

The committee is made up of sub-committees including an investigating committee, a disciplinary committee and an appeals committee.

"The Institute of Chartered Accountants sets up these things. The same people who frame the controls exercise these things. They leave loopholes," Consultant, Association of Stock Market Investors, Dr. N I Wikramanayake said." The Accounting and Auditing Standards Monitoring Board should be able to take it up," he said, referring to the power of the SAASMB to bring errant auditors to task.

Core package from Mercator

Mercator, the Dubai-based provider of systems and solutions for the airline industry, has successfully implemented the Oracle Financials application at SriLankan Airlines in a record four months - at least four weeks ahead of schedule says a news release.

SriLankan Airlines will benefit from the package, which offers an integrated accounting solution for all head office related accounting functions. This is the result of a contract signed among Mercator, with India's Satyam Computer Services and Oracle Middle East to offer Oracle Financial Applications suited to airlines.

Mercator, the IT subsidiary of the Emirates Group, is sourcing the Oracle Financials Application licenses and maintenance support from Oracle Middle East. Satyam Computer Services, a specialist in network technology and systems integration based in Hyderabad, India, is offering their implementation expertise in Enterprise Resource Planning systems.

Peter Hill, SriLankan Airlines' Chief Executive Officer, said: "Mercator has already implemented two advanced accounting packages for us - being the revenue accounting solution RAPID and the outstation accounting software, COMET. This latest implementation to integrate the accounting functions will allow us greater flexibility in managing our business on a global scale."

Hugh Pride, Mercator's Senior General Manager, said: "SriLankan Airlines now have a fully integrated suite of airline specific financial applications. Apart from the function benefits, this ensures that the carrier will have a Y2K compliant accounting application".

The implementation at SriLankan Airlines was managed by a Mercator project team working together with SriLankan's accounting and technical personnel and Satyam Computer Services' consultants.

Goldstein Award for Grey

Proctor & Gamble (P&G), one of the biggest multi-national companies awarded its Robert V. Goldstein Awards which is the Company's most esteemed communications award to Grey Advertising of Sri Lanka, for P&G's global campaign for Pringles says a news release.

According to Pankaj Arora, General Manager of Grey Sri Lanka, many leading agencies vied for this prestigious award by P&G which is awarded to the communication house that provides the best Integrated Marketing strategy which succeeds in bringing tremendous sales and profits throughout the world. "What makes it highly prestigious is the fact that worldwide P&G has 6 agencies, and therefore for Grey Lanka, competing amongst the best and succeeding in holding our own is indeed an achievement to be proud of," he said.

With yet another global trophy on their shelves, Grey International has gone from strength to strength and is now the 6th largest agency in the world, the No. 1 in the US and has evolved to become a Communication Powerhouse, with a network that spans 90 countries where they continue to serve more blue chip multi-national clients than any other global network. P&G's global advertising campaign "Once You Pop You Cant Stop" designed by Grey has helped propel Pringles from a US export in a handful of markets in 1990 to a global brand in over 40 countries including Sri Lanka.

In Sri Lanka, Trikaya Grey First Serve's successful Radio and BTL (Below The Line) campaign for Pringles played an important role in Sri Lanka's entry in New York. The Radio advertising campaign which was called the 'Confession Campaign' and was developed locally, had a tremendous impact on the sales of Pringles in Sri Lanka.

Cathay Pacific awards ceremony

The Cathay Pacific Airways Awards ceremony recently held at the Hilton Colombo to felicitate their agents, both passenger and cargo, was a glittering event says a news release.

Welcoming those present, Michael Yuen, Cathay Pacific Airways Country Manager for Sri Lanka and the Maldives said, the evening was a celebration of the efforts made by agents to promote Cathay Pacific Airways in Sri Lanka. "We take this opportunity to recognize your contribution towards making our operation in Sri Lanka a success and to say 'Thank You' in a very special way, straight from the Heart of Asia...." he said.

Acknowledging that the past few years had been difficult ones due to a variety of reasons such as the Asian Financial Crisis, he said, "We have overcome the worst of it and are in excellent shape to ride on to recovery." Enumerating the airlines plus point Yuen noted that Cathay today has a passenger fleet which is now the youngest in the world at an average age of 4.3 years. "We have the best airport in the world, the largest kitchen, the largest cargo terminal, new uniforms which are fantastic, a great new first class and the best headquarters in Hong Kong if not in Asia...."

Mr. S. Pirabaharan, Director Sales of Cey-Can Travels and Tours (Pvt) Limited walked away with the Gold Award for Passenger Sales while Mr. Suresh Mendis, Director of Hemas Travels took the Silver Award. The Bronze Award went to Gabo Travels with Ms. A. Thambyah, Ticket Office Manager of Gabo Travels Fort Office on hand to collect the award. Top Cargo Awards went to Expeditors Lanka (Pvt) Limited with Mr. C. Jayaw- ardena, Manager Operations present to collect the Gold Award. The Silver Award went to Expolanka Freight Limited with L. Rama- naden, GM present to collect this award while R. Batcho, General Manager of Roton Vander Limited took away the Bronze Award.

Celltel awards contract to Alcatel

Celltel Lanka Limited, the market leader and pioneer in cellular services in Sri Lanka, last week selected Alcatel, for the installation of its soon to be launched "New Generation" GSM network. Alcatel won the contract over competition from European and North American companies, and will provide the very latest technology in the GSM world and in Sri Lanka says a company news release.

With consumer services like Internet on the handset, sending images from one person to another and even video conferencing being a distinct possibility in the near future, Celltel's new GSM service is appropriately named "Celltel Infinity." Celltel's Chief Executive Officer Michel Schluter said: "The name 'Infinity' reflects Celltel's vision of providing to our customers, a world of endless opportunities, supported on the latest generation GSM technology."

"Celltel Infinity will be launched during the first quarter of 2000. It will be a complimentary service to our existing highly popular and successful Celltel and CellCARD services which offer subscribers, the best coverage and call quality. Customers with Celltel therefore, will be able to benefit from either service depending on their needs and lifestyle," he added.

Celltel's investment in the new technology network brings its total investment in Sri Lanka to US $60 million (about 4.3 billion). Alcatel will be providing the Alcatel 1000MSC, which is rated highly for capacity and call quality, the EvoliumTM GSM base stations including micro base stations for excellent coverage, radio solutions offering high network performance and quality and a fully-manned, round-the-clock Operations and Maintenance Centre (OMC). The network is capable of providing all the value-added services like automatic international roaming, Caller Line Identification, Short Message Service and more.

"Infinity, is yet another pioneering landmark in the Sri Lankan cellular industry, in the same way that Celltel, CellCARD and Celltelnet have been," said Schluter.

Gestetner world accounts exhibition

Gestetner International with its Sri Lankan counterpart Gestetner of Ceylon Ltd., held an exhibition of their latest digital multi-functional products named as "World Accounts Exhibition" at the Jaic Hilton on the 7th and 8th of December says a company news release.

Dr. Arthur C. Clarke who inaugurated this exhibition on the 7th of December, while the Chief Guest on the second day was His Excellency Yogi Sugiyama, the Japanese Ambassador for Sri Lanka.

Speaking at the press conference Dr. Clarke said, the world is now entering a new era, that is transmitting objects not mere information. He also added that this has already started at an early stage and is being experimented with cross-lazers in a few countries.

Mr. Anzar, Chairman, Gestetner of Ceylon Ltd., said that GOCL holds a grand market share of 90% in the Digital category in Sri Lanka.

Director, World Accounts, Gestetner International, Mrs. Mary De Zilva said, Gestetner since its inception by David Gestetner with his innovation of "The Duplicator", the world's first paper copy machine has gained remarkable achievements, while holding a market share of 35% the world over and 64% in Europe in Digital Multi-functional Products.

On display at the exhibition were a range of photo copiers, digital photo copiers, digital copy printers, computers and fax machines.

Century of change in U.S. financial industry

NEW YORK, (Reuters) - The Greeks, Assyrians and Babylonians had money lenders. The Venetians invented modern banking in the 12th century. But the most dramatic revolutions in the financial services business came this century. Computers, deregulation, the Internet and globalisation have spurred sweeping changes in the business in just the past few decades, leading to fewer but larger banks and brokers, and a shrinking number of tellers."In the last 20 years, the banking industry has changed more than at any time since the Italians invented it," said Roy Smith, a professor of finance at New York University.

"Deregulation, globalisation and technology improvements have completely altered the way banking functions both as a societal instrument and as a means people use the banking business to make money." Instead of waiting in queues at branches to cash pay cheques or buy savings bonds, people now bank by telephone, pull money from cash machines at all hours, trade shares on the Internet, pay with plastic debit cards and apply for car loans over their personal computers.

Stocks hold a greater chunk of people's savings than ever before and the U.S. securities industry's profits have swelled as a result. And Depression-era walls barring U.S. banks, brokers and insurers from entering each others' businesses have crumbled, fuelling consolidation and competition." The banking system really is a reflection of our needs as a society," said Jesse Stiller, the historian at the Office of the Comptroller of the Currency, a bureau of the U.S. Treasury that regulates national banks.

The Venetians laid the roots of modern banking back in 1171,when its citizens lent money to the powerful republic and received four percent annual interest. The people exchanged credits, which were more convenient than coins, and the practice took off. In the United States, the first commercial bank was formed by an act of Congress in 1781 shortly after independence. The Bank of Massachusetts and the Bank of New York Co. Inc. opened in 1784. The U.S. securities business took hold in 1790 when the government issued $80 million in bonds to finance RevolutionaryWar debt. Two years later, the New York Stock Exchange was born when 24 brokers signed a deal to trade with each other under a buttonwood tree at 68 Wall Street.

Banks, which gradually assumed a greater role in the country, came under tighter regulatory control after many failed during the Great Depression, which was triggered by the stockmarket crash of 1929. In 1933 the Glass-Steagall Act set up barriers between commercial and investment banking to ban banks from riskier businesses like underwriting stocks.Since then, they have gradually made inroads in each other's businesses, dating back to 1987, when the U.S. Federal Reserve first allowed bank subsidiaries to earn five percent of their revenues from underwriting activities.

Top bank Citicorp and securities and insurance firm Travelers Group made history last year when they merged to form Citigroup Inc , the No. 1 U.S. financial services company that aims to offer everything from stock trading to mortgage loans. But the divides were only completely removed several months ago when Congress passed legislation overhauling the rules governing financial services legislation. Analysts forecast that deregulation will spark more mergers.

The U.S. financial services industry again came under tighter regulatory scrutiny in the 1980s, after the savings and loan crisis and the Latin American debt crisis. Unchecked bad lending by savings and loans forced Congress to commit almost $150 billion to bail out hundreds of thrifts that failed, while multinational banks were burned by risky loans that went bad in Latin America. And, just last year, banks and brokers were hit with trading losses after Russia defaulted on its loans and triggered turmoil in emerging markets around the world.

As regulations shifted industry practices, technology has transformed financial services business, from the introduction of telephones at the stock market in 1878 to computers and cash machines that let people bank around the clock."In the late 1800s, banks were using modern advances like telephones, railroads and steamships to improve performance,"said Michael Mayo, an analyst at CS First Boston.

No time for breath in Euro banking sector

The past year got off to a quick start when in January

Spain's Banco Santander and Banco Central Hispano stunned the market with their merger to form BSCH , now regarded by many as one of the best placed banks in Europe. Other highlights of the year were the extraordinary hostile attempt at a "menage a trois" by France's Banque National de Paris which tried an audacious takeover of two banks, Societe Generale and Paribas, who had already announced their own merger plans. BNP failed, ending up with Paribas but leaving SocGen to plough its own furrow. There were also entertaining sagas in Italy, where the central bank intervened to stop a hostile takeover, and Portugal where the authorities had a spat with the European Commission over BSCH's plans to buy into the Portuguese market. Hostility also returned to the British scene with Royal Bank of Scotland and Bank of Scotland locked in a battle for an unwilling NatWest . Analysts say there is room for more action in Britain which will happen in the likely event that NatWest loses its independence. "If one goes then others will follow," said Bryan Crossley, European banking analyst at ABN AMRO. "I can also see some action in Germany and there are still deals to come in secondary banks in Italy."

Another theme of 1999 has been the extension of cross-shareholdings among banks and insurance companies making an already complicated web even more dense. This is the one aspect of current trends where analysts seem unsure as to the motivation behind banks taking stakes in each other and the eventual outcome. "Banks are taking stakes in each other not with the intention of doing value creating mergers but rather to stop anyone doing anything they don't like or to improve their bargaining position in the future," said Graham. The feeling is that few senior bankers are clear on how banking in Europe is going to turn out and will want to keep their options open for as long as possible.

The web of holdings could mean that a given pair or trio of banks finally bite the bullet and go for the true cross-border merger. Until now, other than in investment banking, cross border moves have been restricted to markets which have strong cultural and business links such as in Scandinavia and Benelux.

The received wisdom has always been that the cost-cutting logic of mergers would not be present across borders and that markets, already sceptical that the former add value for shareholders, will be even more so when faced with a cross border move which has to be sold on vision. But if someone does it then that could redraw the map. "Most banks are keeping their options open but if you get one forward thinking management that does a curve-ball deal then that could accelerate the whole process," said Graham. One variable for banks in their deliberations on how they join the winners rather than the losers is the impact of technology, an aspect which will grow in importance in 2000. This has two main strands, in retail banking and in electronic broking — both areas where traditional players are seeing their territory eroded by new players."Banks will have to start paying even closer attention to technology and one point is that this development will often undermine the commercial logic of consolidation," said Crossley of ABN AMRO.

In the technological storm, successful banks will have to have strong brands, offer a broad package of products, be cheap and use Internet operations to offset the costs of more traditional distribution. Crossley also feels that investors will have to look at banks in a completely different way and banks will have to realise that their pool of customers are less captive than they were.

A good example is first-e, an internet bank which is purely technology based and has no operational link to any existing financial institution.

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