EUROPEAN BANKS MUST REINVENT THE BRANCH, FORRESTER ADVISES

***Transformation To Networked Service Centers Will Lower Costs And Improve
                                Service***

LONDON, 24 April 2002 . . . Banks will not meet their key objectives --
improving customer service and reducing operating costs -- by simply
Web-enabling branches as they are today, Forrester Research (Nasdaq: FORR)
asserts in a new report. To avoid throwing good money after bad, Forrester
advises firms to aim their investment at the future role of branches as
networked service centers. Forrester defines these as thinly staffed
collaborative service centers based on open standards and connected to
internal or external service networks through integration hubs.

"Between 1999 and 2001, European banks invested 13 billion euros in
Internet and call center technologies," said Forrester Senior Analyst Remus
Brett. "Anticipating the demise of the physical distribution network, banks
in the UK, France, and Germany closed 11 percent of their branches between
1995 and 2000 and brought branch technology innovation to a standstill. The
profit slump following the economic downturn now forces bankers to further
their cost rationalization plans and cut branch operating costs."

Seventy-three percent of the European banks Forrester interviewed believe
the Internet has so far had little or no impact on branch distribution, and
61 percent believe that branches will remain the dominant channel in 2007.
However, nearly half of our interviewees have begun to connect their
branches to online banking applications as part of a multichannel
integration strategy, and another 24 percent plan to do so. Thirty-nine
percent believe they can cut costs by upward of 15 percent -- mainly in
application development and maintenance -- all while improving customer
service.

"But contrary to banks' current Web-based plans for branch improvement,
networked service centers will build a service level that doesn't exist
today, cut costs by reducing headcount, and create an open technology
platform that's ready for the future," Brett added.

To prepare for business networks and Open Finance becoming pervasive by
2007, Forrester advises European banks to build an infrastructure based on
collaborative networks and open standards. Networked service centers will
create meaningful interactions by giving agents real-time customer
profiles, empowering staff with guided sales tools, and collaborating to
match human specialist advisors with customers. Broader network bandwidth
will let service center staff get customer data in real time -- including
data like Web usage and a customer's history on other channels. Networked
staff will be equipped with modular, Web-based advice tools and will be
empowered by a superior command of those tools.

"Networked service centers' thin clients will run applications on
Net-native platforms," Brett said. "All basic customer applications, such
as bill payment and fund transfers, will be centralized on integration hubs
-- cutting development and maintenance costs. Networked service centers
will strip manual and electronic processes out of the branch, as firms use
workflow technology to take the paper out of credit checks for mortgage
applications. Reinvented as networked service centers, branches will be
able to participate in this Open Finance future. Networked service centers
will drive new business as banks partner with local insurers, financial
advisors, and real-estate agencies."

For the report "Reinventing Branch Banking," Forrester interviewed
executives at 33 leading European banks.