Another operational hurdle is managing the extra demand on already-overtaxed systems. Separate customer service operations, manned by licensed securities experts, must be built and maintained for e-brokerage. And while a typical Internet banking customer might visit a site once a week to make a payment or check balances, many online investors log-on hourly to get quotes, research, news and other information. If the system goes down for even a few hours during a market sell-off, a bank could be sued. Bankers have to understand the frequency of use and other requirements of investors, and scale their operations with brokerage volume in mind.
Many banks claim significant progress in building their e-brokerage units.
But Marenzi says the industry continues to experience trouble on numerous fronts, including systems architecture, vendor selection and management oversight. Meanwhile, the pace of customer adoption has been frustratingly slow, given the investments made. With time, however, e-brokerage operations could prove rewarding for at least a few banks. Another law of nature is that big companies can't get excited about small opportunities. It's not that their managers are bad.