A venture that aims to be the first pan-European Internet-only bank expects to begin signing up customers within weeks, its chief executive officer said.

First-e will start in the United Kingdom in August or September and expand within 18 months to Germany, France, Italy, and Spain, said CEO Xavier Azalbert.

The plan is more geographically ambitious than that of SEB Bank of Sweden, which said it will introduce an Internet bank across the Nordic region within a year.

First-e is a subsidiary of Enba PLC, a holding company established in March and based in Dublin, currently with 64 employees.

The company is a brainchild of Gerhard Huber, an Austrian-born executive who was instrumental in setting up Germany's first discount broker, Direkt Anlage Bank AG, as a subsidiary of HypoVereinsbank. He was also an executive vice president at Fidelity Brokerage Services in the United Kingdom until 1997.

Banque d'Escompte, a bank in Paris serving high-net-worth individuals, is a partner with Enba. The bank provides financial backing, while Enba concentrates on the technology.

"We looked at ways to get into the market fast, and so we developed a licensing agreement with Banque d'Escompte," said Mr. Azalbert, who worked with Mr. Huber at Fidelity.

They have been working on Enba since December 1997 and "designed this from scratch," said Mr. Azalbert, a Frenchman.

Other investors include Intel Corp. and the venture capital firms Apax Partners, Vertex of Singapore, Switzerland-based Aureus AG, and Invision AG of Germany, which is an arm of the retailer, Metro/BHS Holdings.

Enba has raised about $60 million in two rounds of private funding, making it Europe's largest Internet venture capital start-up.

An Enba subsidiary, Factor-e, wants to sell its technology to other corporations on a self-branding or cobranding basis. The strategy is reminiscent of the U.S. Internet start-up Security First Network Bank, now owned by Royal Bank of Canada and separate from its technology source, S1 Technologies.

Mr. Azalbert said Enba has been influenced by such U.S. companies as NetBank, E-Loan, and E-Trade.

Enba has obtained approval from France's central bank for First-e and Factor-e to operate anywhere in Europe, once the relevant central banks give clearance.

Since May 19, First-e has been in a pilot with a few hundred customers in the United Kingdom using a password-protected Web site. The test began with money market accounts and should expand to a full-service portfolio, including transaction and brokerage accounts and a lending and intermediate auction service, by yearend. "We hope to have a few tens of thousands of customers this year," said Mr. Azalbert.

Enba is using technology from Brokat Infosystems AG, a German software vendor with more than 1,500 financial institution customers worldwide.

"Brokat is a very instrumental player," said Mr. Azalbert. It is providing its Twister electronic services platform for First-e and Factor- e, 128-bit encryption for security, the application server and back-end integration. It has also designed First-e's proprietary front end.

"A virtual bank needs to deliver a set of front-end channels that connect customers on various channels," said Michael Schumacher, chief technology officer of Brokat in Stuttgart. "Some parts of the channel-such as call center and the Internet-are used in the Enba project now. I believe this is the best concept of a virtual bank I have seen."

Other aspects of the service have been outsourced. Royal Bank of Scotland will provide corporate bank accounts through its correspondent banking network; International Business Machines Corp. will manage Enba's servers; check clearing and check processing will be carried out by Electronic Data Systems Corp.; Dresdner Kleinwort Benson in the U.K. will handle securities execution; and a South African company, Merchants Group, will handle First-e's calls in nine languages from a call center in Cork, Ireland.

Enba's management team of six has an international feel, with directors from Britain, Spain, Germany, Ireland, France, and the United States. "We built our operations team with European people," said Mr. Azalbert. "If we deliver a service across Europe we need nationals of each country to understand what it means to bank there. The service has to be country- specific."

First-e expects to make a splash in the United Kingdom "with very competitive interest rates," Mr. Azalbert said. There it will likely compete with Egg, an on-line banking division of Prudential Banking PLC that has shown up on a list of leading Internet financial brands compiled by IBM and the consulting firm Interbrand. Andersen Consulting electronic commerce partner James Greene said Enba faces big challenges in going multinational. Each European country "has its own unique characteristics and expectations for providers of service," he said.

Internet-only banks have to overcome three main obstacles, he said: brand recognition, differing regulatory frameworks, and privacy laws so strict that they "cause North American bankers to have heartburn."

Because "noone has established a winning model," said Mr. Greene, Enba is "doing the right thing to try to make it happen. I applaud them."

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