According to the study, it is estimated that the banking industry in theregion will invest around $8.3 billion on information technology initiativesover the next two years. The bulk of this would be invested in retailproducts development and delivery, the study stated. It further added thatalmost a third of Latin American companies expect to earn more than a fifthof their revenues from e-business related activities during the next fiveyears. i-flex solutions (a Bangalore-based banking product and solutionsfirm which has already established a significant presence in the region)head business development (Latin America & Caribbean Islands) Roshan Joshisaid as per the study, large banks in the country would look at expandingtheir product portfolio while the smaller players would focus on bettercustomer services through the Internet. Also, the entry of domestic andinternational players had put immense pressure on Latin American banks toupgrade their technology to avoid being eliminated from the business.

This has resulted in an increased effort to seek competitive advantagethrough improvements in product delivery and increased knowledge amongcustomers, the study revealed.

Mr Joshi said -- ``Due to the economic downtrend and overbanking, the apexbanks in Latin America have asked many banks to come together throughmergers and acquisitions, particularly in Argentina, Brazil and Colombia.''Two years ago, there were over 200 large and small banks in Argentina. Now,the figure is down to 78 as a result of mergers and acquisitions. In Brazil,Bank of Bilbao Viecaya has recently acquired Bank of Santander for a sum ofaround $5 billion. Commenting on the banking scenario in Caribbean Islandsand Latin America, Mr Joshi said, Argentina and Brazil were very strong inretail banking with each bank having 4,000 to 5,000 branches. Mutual fundswas a developed market in these regions with the bond market bigger than theequity market. These frequent mergers and acquisition excercises in thebanking/financial sector have also opened up another market forconsultancy.

``We offer strategic consultancy for banks, advise them on systemic issueson mergers, acquisitions and monitoring NPAs,'' he said. i-flex solutionshas recently opened its office in Argentina. Currently its consultancydivision has a total strength of 100. Being a significant market, LatinAmerica accounted for 5 per cent of the company's total business last year,Mr Joshi said (during fiscal '99-2000, the company raked in a total businessof Rs 206 crore). Currently, the company is in the process of building upstrategic relations with partners in different countries of the region. ``Wewill soon launch an ASP model service for the region,'' he said. LatinAmerica has been an open economy for the last 15 years. ``It's dollar-basedeconomy will soon make its banking system advanced and accessible to modernproducts,'' Mr Joshi felt.