ABN Amro Bank and Dutch telecoms operator KPN have pulled back from a joint initiative to offer financial services over the Internet in Europe.
The decision to abandon the proposed Money Planet venture follows a review of the project which concluded that it "could not provide the required return on investment", say the companies.
The proposal to build the stand-alone financial portal was announced in mid-July 2000. Money Planet’s aim was to build up its own European customer base of at least one million within four years. ABN Amro and KPN expected to invest a total of EUR150 to EUR200 million in the rollout of the portal in the Netherlands, Germany and Belgium over the first two years. The aim was for Money Planet to be profitable four years after its launch.
"The joint venture was going to operate with a high degree of independence from the two initiators," say the partners in a joint statement. "Since then, circumstances in the market have changed to such an extent that the parties decided to reconsider Money Planet on the basis of the already worked out business plans. This has resulted in the decision this week to end the initiative."
The scrapping of the venture follows the recent withdrawal by ANZ and Overseas Chinese Banking Corporation of a similar joint venture for the pan-Asian markets. Traditional banks have lately moved to distance themselves from the stand-alone business model, preferring to concentrate on integrated financial services delivery across multiple customer contact points.