Nasdaq Launches Venture for ‘Net Trading Overseas
Nasdaq Stock Market Inc. has formed a joint venture with an Indian software developer to create Internet-based trading systems aimed at supporting Nasdaq-Japan and Nasdaq-Europe when those electronic markets go live in 2001. The joint company, called IndigoMarkets, will be supported by SSI Technologies in Chennai, India. The company is developing a back-office Internet-based trading environment that will run on a Tandem Computers Inc. mainframe environment in both Japan and the United Kingdom. In addition, IndigoMarkets will develop and sell Internet-based trading software designed for Japanese and European investors to trade Nasdaq-listed stocks and invest in initial public offerings, said Gregor Bailar, executive vice-president and CIO at the National Association of Securities Dealers Inc., Nasdaq’s Washington, D.C.-based parent company. Nasdaq’s intent, Bailar said, is to make it easy and cost-effective for investors and member firms to route trades to Nasdaq via the Internet — even if that means siphoning trading activity away from electronic communications networks such as Instinet Corp. and other exchanges. “Our altruistic purpose is to create the best trading environment, period,” Bailar said. Nasdaq plans to begin alpha testing the new trading systems this summer, followed by a beta test with 20 to 50 member firms during the fourth quarter of 2000, Bailar said. He said the company plans to launch Nasdaq-Japan in the first quarter of 2001, with Nasdaq-Europe close on its heels. — Thomas Hoffman
E-Banking Wave Sees Swedish Bank Close 50 Branches
With its customers increasingly preferring to conduct their affairs over the Internet, one of Sweden’s largest banks recently announced that it expects to shut down some 50 branch offices this year. The Internet banking unit of Skandinaviska Enskilda Banken AB (SEB) currently has about 380,000 customers, including 25,000 small and medium-sized businesses, meaning that about 25 per cent of its total customer base now consists of those doing business electronically, or “e-customers,” according to information released by the bank executive. Compared to customers who use the bank’s real-world branches for their banking, e-customers also bring in twice the business volume and two-and-a-half times more revenue, SEB said. The shut down of nearly one-fifth of SEB’s branch offices in Sweden will also result in layoffs. In large part due to the branch closures, SEB said it expects to cut some 400 jobs in 2000. Sweden is not the only European country smitten by on-line banking, although the Scandinavian country may well be riding the crest of the wave due to its higher-than-average IT adoption rate. In total, European banks are expected to increase their e-banking implementation spending to US$1.4 billion by 2004, up from US$362 million in 1999, according to Datamonitor PLC, a U.K.-based market researcher. — Terho Uimonen
Citibank Offers E-business Solution in Philippines
Citibank has launched a program to offer e-business solutions to corporate customers looking for a single automated system to manage and complete on-line business transactions. “We are following where the market is heading,” said Jaime Nasol, CitiCommerce product manager. “Internet usage has been increasing and more transactions are being done in a paperless manner. We believe companies will take advantage of the growing demand for Internet products.” With CitiCommerce.com, businesses can improve communications with partners and cut short the transaction cycle. The browser-based system can be integrated into companies’ existing business management systems and can be used as a closed network of buyers and sellers, Nasol said. CitiCommerce.com provides facilities for on-line product orders, order status monitoring, settlement and reconciliation. “It offers businesses real-time management information where they can post electronic catalogues, do Internet billing and allow their clients real-time tracking of their order status,” Nasol said. For companies who want to migrate from traditional systems to automated solutions, Nasol said Citibank will integrate the system into their own Web site or, if they don’t have one, customers will be given space in the CitiCommerce portal. Customers may choose who they want to log into their Web sites and then advise Citibank of their client list. Citibank will then provide a logon number to customers’ clients using a pre-enrolled smart-card security system so they can enter the customer’s trading network. On the host side, CitiCommerce uses the Verisign certificate which provides 128-bit triple DES security. — Mayme P. Fernandez
