An Historical Appraisal of Information Technology in Commercial Banking

b s t r a c t The central role of information processing in banking leads to an expectation that banking and finance companies will be strongly affected by technological innovation in general and applications of information and communications technologies (IT) in particular. This research reviews those effects on banking organizations with reference to front-office or external changes (product and service innovation) and back-office or internal changes (operational function) brought about to banking organizations. The research then discusses the potential impact of more recent innovations (i.e., electronic purses, digital cash and Internet banking). The research provides a historical perspective on the main drivers determining adoption of technological innovation in commercial bank markets. A former derivatives trader and research analyst, since 1991 he has been active in teaching and researching comparative financial markets, the absorption of information technology in banking and the strategy of financial institutions in Europe and North America.) is the National Westminster Professor of Banking and Financial Services at Manchester Business School (UK). His main interests have been in financial economics and national and international financial forecasting. He has written two major surveys on pan-European banking, is a member of the foresight panel on financial services, editor of the finance volume of Blackwell's New Encyclopaedia of Management and chairman of CIS's Environ Fund advisory panel.