Citic Ka Wah Bank is planning a HK$120 million upgrade of its information-technology system. It wants to bolster its competitiveness in the face of the online banking trend. The bank has appointed United States-based financial industry system integrator Alltel Information Services to create a common technology platform for branch computer systems, automated-teller machines (ATMs), customer care centres and online banking operations. Executive vice-president Kane Gong said the upgrade would allow the firm to better price, sell and deliver its products, and to improve customer service. This would be possible by better internal information sharing. 'It will bring changes to the way we do business,' he said. 'Our sales staff will be able to cross-sell services to customers, and expand delivery of services beyond branches and ATMs. 'Our customers will be able to consolidate their various financial services relationships with us.' He said the new system would automate a lot of previously manual back-office work, allowing the bank to redeploy some staff to carry out sales functions. He would not comment on the cost savings the upgrade could bring, apart from saying he expected it to be 'substantial'. In the first phase of the project, the firm would spend about HK$100 million to upgrade its core banking system. Mr Gong said this was 'well over 10 years old'. The bank has set the target of operating its new core system in the first quarter next year. It was hoping to achieve a 30 per cent to 40 per cent growth in its customer base by the end of next year. In addition, the bank is planning to spend about an additional HK$20 million in a second-phase investment to develop Internet-based wholesale banking and treasury trading systems. It expects to perform testing on the machines by October. Meanwhile, senior vice-president and head of information technology Eddie Lam Che-keung said he expected proliferation of virtual banks - branchless Internet banks - to slow down in Hong Kong. He said that although some virtual banks had been launched overseas, local customers still lacked confidence in them. These customers, he said, were only just starting to embrace online banking and feeling their way with the new technology.