Strategies for the Financial Services Industryin the Internet Age

Globalization of financial markets resulting from both IT (particularly internet standards) andincreasing homogeneity of regulation has strongly affected the environment, financial servicescompanies are operating in. Given these changes on the market, innovation is not a choice, but anecessity to survive. Observable today, however, are defensive strategies and poor service quality. Inthis paper based on investments in trust relationships with customers we propose Sophistication (fit)Banking enabled by IT and qualified staff and show first steps towards the implementation of asophistication banking strategy. While traditional markets are characterized by shrinking marginsand declining shareholder values, which can easily be explained by considering the digital character offinancial products, new intermediaries for customer-centered Sophistication (fit) Banking have theopportunity of becoming spiders in the web and increasing shareholder values constantly....