The ecosystem of the EU Banking System

The ecosystem of the EU Banking System

edges are defined as a business organisation that performs sets in relation to money. Specifically is the time of action of keeping money for customers and paying it out on need, in the form of deposits, borrowings and exchanges. It has become a cliché to observe the revolutionary impact of information technology (IT) upon any industry, but the real upheaval lies just ahead. As experts back in the 90s stated, “If the number-crunching mainframe computers of the 1970s formed the childhood of IT, and the flowering of personal computers during the 1980s marked its youthful adolescence, then the 1990s seem likely to see the passage of IT into adulthood”. As it has been foreseen, during the 21st Century, technology became directly related to almost every single activity and function of a bank. Deposits, withdrawals, loans, move of capital and updating are just some of the roles that are carried out electronically, as computers sustain communication networks or ATMs.

In the late 1990s, edges have come to realise already more and understand better the importance of technology since they have tried to take advantage of its progress. The computer sciences and all aspects in telecommunications, with particular emphasis on the Internet capabilities, constituted one of the most profitable areas edges decided to invest. These two fields of technology have had the greatest possible for growth and profitability. Currently, as the edges anticipate the rapid IT growth potentials, they continue to give a lot of emphasis on the technology of e-banking-the transactions with edges by Internet-and e-commerce of products and sets. Noticeable is the fact that almost every bank in the globe currently offers e-banking sets via their Internet links.

During the past ten years, a trend has emerged as major edges or groups of edges have formed alliances with companies in the telecommunications and computer sciences fields, or in other different industries. For example, in the UK, two Scottish edges have joined up with major supermarket chains in order to provide an outsourced banking function for the so-called supermarket edges. The motive for such kind of strategic decisions was the profit from a dynamic field that showed revenues increasing in a rapid rate.

Furthermore, it is true that the Banking Sector throughout Europe has little by little restructured itself in order to be able to meet the challenges provoked by the unification that has recently reached the meaningful development of twenty-five member states. Operating in this new ecosystem, edges have to confront some major issues, such as the intensification of competition, the technology breakthroughs referring to transactions, the globalisation of capital and money markets, the development of management and administration, the extensive use of derivatives, the development of international transactions and the introduction of financial innovations. consequently, EU edges in order to cope with the basic forces mentioned above, are trying to find ways to enhance their productivity and effectiveness, reduce their costs, upgrade the quality of the sets they provide, strengthen their presence in new markets, reduce the exchange risk, and finally unprotected to great macroeconomic stability.

Experts state that the upcoming changes will also force edges to reconsider their position in terms of effective bank size, economies of extent in the new ecosystem, creation of a new powerful capital base, globalisation of the activities in addition as of the wide variety of product/service lines they provide to customers. According to the estimations of “International Monetary Fund” and the “Organisation for Economic Co-operation and Development”, it is a fact that the edges have already invested meaningful capitals to new technology applications, while most have already introduced “personalized” sets for their European or global customers.

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