Allied Irish Banks has dropped plans to develop a stand-alone Internet bank, saying online banks across the world have been slow to attract customers.
The bank says it will instead focus on developing its integrated offering, 24 hour-online.
The decision comes after a review of AIB’s e-business strategy. Work on the standalone Internet bank started earlier this year when it was believed customer take-up of online banking services would be quick and substantial.
Since then, Internet-only banks in markets across the world have been slow to attract customers, the bank says in a statement. Bricks-and-mortar banks have also been quick to match and exceed the services offered by the new-style providers, the bank contends.
AIB’s head of electronic banking Billy Andrews says: "In this fast-moving market, it is clear that timing and customer preference are as important as technology. Our extensive research in the e-business area has led us to the decision that integrated rather than stand alone is now the right approach in Ireland."
AIB 24 hour-online will have in excess of 100,000 customers by the year end, he adds.
AIB's decision comes a day after first-e, the Dublin-based Internet-only bank scrapped a multi-milion pound television advertising campaign a fortnight before it was due to be screened. The bank blamed the spiralling cost of customer acqusition for its retreat. The Irish Times today reported that first-e has warned its 470 strong staff it will cut up to 90 jobs in a bid to further rein in costs.
Toyko-based Sanwa Bank, which is merging with Tokai Bank and Toyo Trust & Banking to form the world's No. 5 lender, also reported earlier today that it too is ditching plans to set up a stand-alone Internet bank.