Proceedings of the 12th International Academic Conference, Prague

THE IMPACT OF INTERNET TECHNOLOGY ON THE ROMANIAN BANKS PERFORMANCE

LAVINIA MIHAELA GUTU

Abstract:

In the last decades the Internet technology era has developed increasingly more and currently it spans the whole business world. Nowadays no manager can conceive the existence of a successful business without its existence in the online environment. Therefore, more and more companies have moved a part of their activities on the Internet in recent years. This fact helps them to become more popular and to attract more customers. So, for the business world, it is well-known that a respectable company should have a website. Banks are also involved in this process. The information technology and communication revolution has affected the financial services, too. The majority of banks have websites today. Here they communicate with the public and carry out certain activities with clients so that they no longer have to go to the bank. But how does the Internet influence the performance of a bank? Since it is about a revolution in this field, it is expected that banks’ performance to increase. The presence of a bank on the Internet through a website, the Internet banking and any other activities undertaken by the bank in the online environment such as online advertising should improve its financial results. Even if the bank spends more resources in this regard, it is expected that more customers to be attracted and that operations made by banks’ employees to be replaced with this kind of technology. This paper examines this issue in the case of Romanian banking industry starting with 2005. How has the Internet technology affect the performance of a bank in terms of ROE? Have the banks benefit from this kind of technology revolution or the costs of these service affects their results since the users of this technology is lower than the developed countries?

Keywords: Electornic banking, banks' performance, Internet banking

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