“Increasing international competition presents Dutch lenders with major opportunities according to Atos Consulting research”

Utrecht, 10 July 2007

Atos Consulting advises Dutch banks to operate ‘aggressively' Atos Consulting, the business consultancy arm of Atos Origin, foresees major opportunities for Dutch lenders offering consumer credit now that the European market is being increasingly liberalised.

“Dutch lenders do not need to be concerned about the arrival of foreign lenders on the Dutch market, but should instead prepare to take advantage of a marketing opportunity”, says Edy Kikken, Principal Consultant Financial Services at Atos Consulting. “Dutch participants in the market are in such a good position that they can actually benefit from free access to the European market.”

The consumer credit market is characterised by high volumes and low margins. Overall, consumer credit in the EU amounts to some 900 billion euros. Only 1 per cent of this total was arranged with a foreign lender. Now that the rules for concluding consumer loans are being increasingly levelled out internationally, European consumers will be less wary of taking the plunge with foreign partners. The supervision provided by national supervisory authorities to ensure that new entrants to the market are supplying consumers with reliable information will also do a great deal to reassure customers.

Atos Consulting is convinced that the elimination of borders and the introduction of unambiguous rules in the field of consumer loans offer Dutch lenders great opportunities. “New European rules are making international lending easier. In the context of internationalisation, Dutch lenders have an enormous advantage because they have their back-office processes in place. This means that the foundations have been laid for a foreign venture, and it is easy for a transformation process to be realised. A sophisticated internet-based marketing policy can then be utilised to introduce, on a foreign market, a new brand that inspires confidence”, says Kikken.

Moreover, according to Kikken, Dutch lenders are operating out of a protected Dutch market. “The Dutch government is trying to take the consumer's part by discouraging too much lending. This worsens the conditions under which international lenders can come onto the Dutch market. So since our own house is in order and our market is protected, it seems to me that an aggressive foreign strategy is appropriate.”

When Dutch lenders enter a foreign market, care will need to be taken in buying in core processes and/or functions locally. In the opinion of Atos Consulting, this relates, for example, to credit scoring (consumer risk analysis), and settlement of collection and debts in the event of (impending) consumer default. In addition, with a market that is operating more internationally in the field of credit records, a great deal still needs to be done to ensure that lenders have a clear insight into the overall credit raised in various countries in order to prevent consumers from exceeding overdraft facilities.

All in all, Atos Consulting advises Dutch lenders to embrace the liberalisation of the European consumer lending market. This view is shared by Ernst Siegert, Executive Consultant Financial Services at Atos Consulting, who also says, “They should be able to operate much more aggressively in it”. He advises Dutch market participants to concentrate on the internet route (direct selling) and affinity groups, groups of like-minded consumers who need to be approached with a clear, market-oriented offer. Here, for example, one might think of allowing membership cooperatives a reduction in interest. Siegert: “Or of approaching certain sectors of industry that take the plunge with a specific lender, such as healthcare, a sector in which consumption is increasing.”

Siegert: “If you opt for a sophisticated service concept and brand policy for specific market segments, with the backing of a strong parent company you can take advantage of local markets. Dutch banks are already doing this on their own market, but can also do very well on international markets in this way. Look at how ING Direct has acquired a firm foothold in the United States. ING took full advantage of its good name and reputation to establish itself in a new market.”

About Atos Origin
Atos Origin is an international information technology services company. Its business is turning client vision into results through the application of consulting, systems integration and managed operations. The company's annual revenues are EUR 5.4 billion and it employs 50,000 people in 40 countries. Atos Origin is the Worldwide Information Technology Partner for the Olympic Games and has a client base of international blue-chip companies across all sectors. Atos Origin is quoted on the Paris Eurolist Market and trades as Atos Origin, Atos Euronext Market Solutions, Atos Worldline and Atos Consulting.

About Atos Consulting
Atos Consulting, the global consulting practice of Atos Origin, is a leading provider of business, process and technology consulting services. With more than 2,500 staff globally, it focuses on delivering proven, pragmatic solutions to the telecom, manufacturing, financial services and public sectors.

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