As Wells demonstrates, Internet technology does make possible an integrated offering. Being federally-insured depositories, however, banks are burdened with some unique privacy and legal concerns. Limitations on sharing information between banking and brokerage units force institutions to erect costly technical and organizational firewalls. That hinders effective cross-selling between the two units. Perhaps even more daunting, banks are latecomers to the e-brokerage party.
Few banks can muster the level of investment and managerial commitment required to catch up.
But for banks that are up to the challenge, the rewards of mastering e-brokerage can be substantial. Such capabilities can pay off in stronger customer relationships, particularly among the more affluent segments. Many bankers and experts believe that as the various sectors of financial services gradually converge, customers will gravitate to providers who can blend banking and brokerage into one compelling value proposition. The e-brokerage players are only going to get better and better. Click to view To compete in e-brokerage, banks must beef up their systems to handle the higher volumes generated by Internet trading.