E*Trade Group Inc - One Of The First All-electronic Brokerages, Diversified Revenue Streams Aimed To Balance Growth

E*Trade Group Inc. provides a range of online personal and institutional financial services through its wholly-owned subsidiaries. Access to the company's offerings can be found at its primary Web site, which offers links to investment options, financial services, discussion groups, live events, and more. The company's principal subsidiaries include E*Trade Securities Inc., which provides online retail brokerage services to individual investors. Investment options offered through E*Trade Securities Inc. include stocks, options, initial public offerings (IPOs), mutual funds, bonds, and extended hours trading.

E*Trade Group also provides online banking services through E*Trade Bank and owns E*Trade Access, a national network of more than 9,600 automated teller machines (ATMs) located in 48 states and three countries. E*Trade Bank launched in April 2000 following the acquisition of Telebanc Financial Corp. and its Internet banking subsidiary, Telebank, which was the largest Internet bank. Through its Web site www.etradebank.com, E*Trade Bank allows customers to open accounts, view consolidated balance statements, transfer funds between accounts, pay bills, and compare rates. While nearly 90 percent of E*Trade Bank's customer contact comes over the Internet, the company maintains customer service call centers that are open 24 hours a day. E*Trade Access was formed in May 2000 following the acquisition of Card Capture Services Inc. E*Trade Access is in the process of developing financial services kiosks as a complement to its ATM network.

Internationally, E*Trade Group offers online retail brokerage services, as well as financial services to institutional investors. The company operates nine Web sites outside the United States, either through licensees or through wholly owned subsidiaries, which serve investors in the United Kingdom, Denmark, Norway, Sweden, South Africa, Germany, Australia and New Zealand, Canada, Denmark, Japan, and Korea. After terminating an agreement with a French licensee, the company is seeking to re-enter the French market. E*Trade's international strategy is to leverage its brand name, Web site design, and proprietary technology to create a fully electronic cross-border trading network. By linking financial markets globally, the company hopes to make trading in foreign securities an affordable reality for retail investors. The prototype for this vision is E*Trade Sweden, which launched during fiscal 2000 and allows Swedish customer to purchase U.S. equities online in real time.

E*Trade Group provides financial services to institutional investors internationally through TIR Holdings Ltd., which it acquired in 1999, and Versus Technologies Inc., which it acquired in 2000. The acquisition of TIR expanded E*Trade's business to include institutional investors. TIR provides global multi-currency securities execution and settlement services, along with independent research, to institutional investors. Versus is a Canadian-based provider of electronic trading services for both institutional and retail investors. The company was E*Trade's licensee in Canada prior to its acquisition. Following the acquisition of Versus, E*Trade incorporated Versus' proprietary electronic trading technology into its global product offerings.

E*Trade customers can buy and sell more than 5,000 mutual funds through the company's Mutual Fund Center, which was established in 1997. Included among the mutual fund offerings are eight proprietary mutual funds, four of which were launched in fiscal 2000. Other services and activities include corporate financial services relating to employee stock option and stock purchase plans and the operation of two venture capital funds.