Transforming Retail Banking to Reflect the New Economic Environment: New Report From the European Financial Marketing Association (Efma) With Microsoft

Fifth edition of Retail Banking Advisory Council report highlights impact of the new economic environment on retail banking; continues to establish blueprint for retail banking delivery

PARIS, December 6, 2010 - The European financial marketing association (Efma) with Microsoft Corp.
today announced the fifth edition of its Retail Banking Advisory Council
report, "Transforming Retail Banking to Reflect the New Economic Environment:
The changing face of retail banking in the 21st century."

(Logo: photos.prnewswire.com/prnh/20000822/MSFTLOGO)

Since its formation by Efma and Microsoft in 2005, the Retail Banking
Advisory Council, consisting of senior executives from Europe's leading
banks, has been chartered with establishing an industry blueprint on the
future of retail banking delivery and plays a pivotal role in providing
guidance and support to the European banking industry.

The latest edition of the Retail Banking Advisory Council report builds
on previous Council recommendations for European channel management, and
focuses on:

    - Transforming the retail network: Rebuilding customer trust and
      confidence; creating an integrated customer experience across channels;
      the future role of the branch
    - Creating a new operating model :Improving operational efficiency; cost
      reduction and the role of technology; the impact of regulation and
      compliance
    - Optimising the online experience: Making the move to digital marketing;
      leveraging intermediaries; the impact of social influence marketing

"The vision of our Council members is to provide customers with a
seamless, fully integrated and uniform experience across all channels," said
Patrick Desmares, secretary general, European financial marketing
association. "Our recent Council discussions have shown that many banks have
re-focused on the branch as the main method of controlling and maintaining
customer relationships. This isn't easy when fewer customers are visiting
branches, so there has also been a considerable emphasis on improving the
online banking experience."

"Banks now need to take much more care in ensuring that they sell the
right products to the right customers, at the right time, through the right
channel," said Tony Emerson, director, EMEA Banking Industry, Microsoft.
"'Needs-based selling' is having a radical effect on how banks operate. It
requires better systems and processes - not only for a clearer understanding
of customer needs but also for implementing the appropriate solutions."

The Council met in closed session to define the core issues European
banks must address to optimise channel delivery in the new economic
environment. Key issues highlighted in the report include:

Customer experience

    - The delivery of an integrated customer experience will meet the needs
      of increasingly different customer segments at the right cost. This
      will be the strategic battleground in the new economic environment.
    - There will be more effective ways of tracking and understanding
      customer needs, and then implementing appropriate processes and channel
      strategies to meet these changes in consumer behavior.
    - Large pan-European banks will establish a core set of customer values,
      delivered in a consistent way across multiple countries.
    - Social networking is a driving force in how banks think about
      marketing, customer loyalty and brand image. Dialogue with customers
      will improve through the increasing use of social media, rather than
      the one-way communication methods of the past.

Channel developments

    - The growth of online banking needs to be matched by improvements in the
      online buying experience. More and better support tools will be
      critical in the drive towards selling complex products online.
    - Branch formats will continue to change significantly, with many
      variations targeted towards different customer segments in increasingly
      diverse locations.

Cultural change

    - New market entrants will have an increasingly significant impact on
      customer expectations in terms of service levels and products that
      banks should be delivering. This will force many 'traditional' banks to
      respond more rapidly than they have done in the past.
    - There will be significant changes in bank personnel and the training
      and skills required for each channel. This will involve major
      investment, but above all an attitude and culture change.

Technology

    - With transactions and customer information generated across multiple
      touch points, the reliance on siloed processes and technology has
      reduced sales productivity. Banks must adapt quickly to survive in the
      new 'customer centric' environment.
    - CRM backed by strong business intelligence continues to be top of mind.
      CRM solutions need to be fully integrated with the day-to-day work
      environment of front line staff to translate customer insight and
      centralised marketing campaigns into successful customer interactions.
    - Banks will increasingly look to cloud computing to help them leverage
      existing IT investments, reduce costs and build an agile infrastructure
      where back end systems can be exposed to new services and channels as
      they emerge and evolve.

"Along with continuing European legislation designed to ensure that
customers get a better deal, we are seeing the emergence of many new
'customer-centric' banks," Efma Secretary General Desmares noted. "These
factors put banks under considerable pressure to provide higher levels of
customer service and to ensure that there is more dialogue with customers
through all channels. Members of the Retail Banking Advisory Council continue
to believe that a strong channel management strategy is critical to the
future success of retail banking."

A copy of "Transforming Retail Banking to Reflect the New Economic
Environment" is available at:
www.efma.com/index.php/our_services/publications_studies_surveys/detail/EN/1/262/1-BH2AY

About Efma

The European financial marketing association has been an unfailing
observer of the numerous transformations that the retail financial services
sector has experienced over the years and has demonstrated its ongoing
commitment to providing a forum for professionals from the sector. Formed in
1971 by bankers and insurers to encourage their colleagues to share
experiences, promote the best practices of their institution and collaborate
through alliances and partnerships, today the non-profit association's
members include over 80 per cent of Europe's largest retail financial
institutions.

Through regular events, publications, and its comprehensive website, the
association provides retail financial service professionals with answers to
their questions about the main issues at stake in their business:
multi-distribution strategies, customer approaches, product and service
marketing, risk management or operational excellence, to name but a few.

Efma is above all a dynamic association, providing a great opportunity
for discussion and exchanges without any commercial constraints. For the past
40 years, the loyalty of its members as well as their permanent financial
support is the best proof of its efficiency.

For more information on Efma, visit www.efma.com

Alexandra Thompson of FWD PR, +44-(0)207-6232368, Alexandra at fwdpr.co.uk, for Efma