Needham, MA, July 10, 2000—As part of the first in a new series of services focused on the online financial services landscape, TowerGroup, the Needham, MA-based research and advisory firm specializing exclusively on the intersection of information technology and financial services, has released highlights from new research on trends in consumer "e-Banking":

• Today, there are some 10,000 FDIC-insured depository institutions within the U.S. The majority of these (approximately 7,800) have yet to establish online financial services. Among the top 100 U.S. bank holding companies, 40% of Internet sites are still at the "brochure-ware" stage.
• TowerGroup believes that the number of U.S. banks offering Internet-based services will double over the next two years.
• Spending by U.S. banks on Internet technology is projected to grow to over $2 billion within the next five years (compound annual growth rate of 31%). Graphic available upon request.
• TowerGroup projects that by 2003, 12 million U.S. households will be utilizing Electronic Bill Presentment and Payment.
• TowerGroup projects that by 2010, 40% of all bills will be presented to consumers and businesses via the Internet. This equals more than 11 billion bills—a dramatic increase from the 10 million sent online in 1999.
• Close to 90% of institutions polled by TowerGroup regarded Internet banking as either "essential" or "important" to their businesses, with nearly 70% giving these same ratings to the issue of "Electronic Bill Presentment and Payment" (EBPP).
• The single most common objective for U.S. banks offering online banking was "customer retention" (a 92% response rate). Next (at 84%) was "customer acquisition."