Technological and Structural Change in the European Banking Industry

The world banking industry is undergoing a large-scale transformation. Banking systems and financial markets, both domestic and international, have been undergoing a series of profound changes. One of the main driving forces of these worldwide changes is the introduction of innovations in new information technologies. Against these trends, industrial structure in the banking industry and banking regulation have sometimes encouraged these trends and sometimes adapted to them. The aim of this paper is to present research findings and the main arguments in the literature on technological change and industrial organisation in the banking industry. The last section of the paper focuses on the role of information technologies in the banking industry. We present research findings of functional studies on IT investment in the banking industry. These studies have analysed the relationship between IT and corporate performance by examining specific IT applications in the context of corporate strategies.