alone was more than usd15 billion in 2001 and expected to increase to usd20 billion by 2005. not all of such investments however, will produce the desired improvements. it investments need to be backed by strong business justification and implementation consideration. new technologies need to be adopted with adequate review as to how it will operate within the broader organisational context. this also applies to initiatives to implement organisation - wide it enhancements, so that it will bring about the intended results. indeed such investments as in the crm application need to be well tailored to individual business models. wasteful investment needs to be avoided. the key is to align and integrate ict into the business models. as technology end - users, the industry is faced with a multitude of product offerings with solutions to improve processes and business activities. this has required sound decision making. the assessment on the return on it investment needs to be based on a longer time horizon, incorporating both qualitative and quantitative benchmarks to ensure that it will translate into improved performance. a key part towards achieving such return targets would be to ensure smart deployment of it applications within the organisation. underlying this process is the need for close interaction between technology and business operators in the customisation stage. such new applications need to be reviewed as to how they will contribute towards improving product and services delivery, aid in risk management activities, and enhance management capability. opportunities from regional integration ladies and gentlemen : another important development that is taking place is the growing regional integration, driven by increasing intra - regional trade and investment flows. asia has seen a rising pattern of intra - regional trade and investment where trade between countries in the region now accounts for almost half of asia ’ s trade from just a fifth over a decade ago. malaysia ’ s share of trade with asean member countries now accounts for 24 % of our total trade reflecting higher intra - regional trade ( notably, increased imports from lower - cost suppliers such as thailand, indonesia and the philippines ) and better economic performance of asean countries. in 2003, malaysia recorded strong growth in exports of 29. 6 % to china and 26. 7 % to hong kong. large businesses and corporations have begun to review their business architecture more aggressively and have moved to relocate their business operations. such structural shifts driven by new demand patterns and new ways of organising production have led to increased specialisation and complementarity within the region. asean alone offers a huge growing market of 500 million people. therein lies the opportunities for the domestic banking institutions, opportunities to support malaysian businesses

institutions embrace the relevant technology to support business processes, enhance risk management capabilities while at the same time provide seamless access to customers through a wider range of delivery channels. all these need to be supported with an effective human resource management framework that ensures the availability of best talent and the right skills. as competition intensifies, banking institutions increasingly must be able to deliver personalised and customised financial solutions. therefore, it is important for institutions to understand the dynamics of customer segmentation, build customer relationship and address requirements and preferences of specific segments. understanding specific segments requires banking institutions to understand complex intangibles such as customer behaviour, motivation and life events. sustainable growth will be very much dependent on the ability to develop lasting and profitable relationships with customers. investing in new products in meeting the complex customer needs and demands is important. equally important is the need to develop an effective communication plan or strategy as a package to product delivery. even the best of products would not have a good chance of success without a well - conceived communication strategy. this goes beyond marketing and advertisement. it would include educating customers to adapt to the new ways of doing banking transactions or changes being introduced and to use the innovative products being offered. it is also interesting to note that the survey findings clearly indicated the importance of quality interface between customers and banks. as such, numerous interface points need to be reengineered to ensure the right mix of the virtual and physical environment. new branch models have emerged, incorporating features from both virtual and physical environment, to fulfil the varying needs of different localities and market segments. conclusion ladies and gentlemen : while the new emerging trends in both the domestic and global economy will have significant implications on the domestic financial landscape, each banking institution will need to be able to formulate differentiated strategies to effectively respond to these forces in a strategic manner. thus, the ability to precisely assess the institutions individual capabilities and strengths as well as opportunities in this changing environment is key to facilitate effective strategic management at the organisational level. through this process, i envisage that the domestic financial landscape will evolve into a banking environment characterised by three types of banking institutions that will emerge to meet the future demands of the economy. a. first, large malaysian banks with nationwide and regional and international presence that are able to compete with global financial players ; b. second, banking institutions with nationwide presence that are able to offer a broad range of financial products and services ; and c. third, specialist niche players delivering specialised value added products