The Bank of Ireland is making its heaviest investment to date in online business by establishing an Internet offshore bank to operate in the Isle of Man. The bank, to be known as Fsharp, will target expatriates who are seeking a high-tech 24-hour banking service. Regulatory approval from the Isle of Man and the Central Bank for the move is awaited. Provided it is forthcoming, the bank hopes to establish the Fsharp at the end of this month and have it fully operational by September. The bank's services will initially target Irish and British expatriates, providing a range of deposit and fund management services, as well as credit and debit cards to allow easy access to funds. The target is to have 10,000 customers by the end of year one and 50,000 by the third year, by which time the bank hopes to be getting a return on its investment.
The cost of the operation is not being disclosed but Mr Tony O'Shea, head of the bank's treasury operation, said that it would be its most significant investment yet in the area and could act as a prototype which could be used elsewhere by the bank. It would operate as a stand-alone operation, employing around 45 people in the Isle of Man. The bank will not offer services to residents of Britain and Ireland.
Research commissioned by the bank estimated that there are 1.7 million British and Irish expatriates with assets of £15,000 (€19,046) or more. According to Mr O'Shea, the bank reckons that this community is already familiar with the Internet - often using it to keep in touch with home - and many have a need for offshore banking services. Those with existing offshore accounts were often dissatisfied with the services on offer, feeling that they are inflexible and make it difficult to carry out their banking activities from a distance.
In time, the bank hopes to spread the marketing of the service to other expatriate communities.
The name of the bank was developed after a lengthy search to find a name not already registered and is designed to give an impression of a leading edge operation.
Bank of Ireland is offering an Internet service - backed up with a call centre open 24 hours a day. It will offer deposit facilities, fund management from Mercury Asset Management and Bank of Ireland Asset Management, a debit card from Standard Chartered and a credit card run by its own card services operations. KPMG will provide tax advice.
Fsharp will be, according to the bank, "the first fully interactive transactional offshore Internet bank".
According to Mr O'Shea, the Internet offers a way to target the expatriate community "in a convenient and cost-effective way".
Customers will be able to conduct all their banking business online, although they will have to initially fill in and return a paper form to establish the account, as the bank needs to be sure of who is setting up the account. Testing will be done with pilot customers over the summer before the bank opens its doors for business in early September.
