BUSINESSWEEK ONLINE : NOVEMBER 20, 2000 ISSUE
INTERNATIONAL -- SPECIAL REPORT

If It's Tuesday, This Must Be Madrid (int'l edition)


In Austria, political parties long controlled the major banks, so Gerhard Huber looked for positions abroad when he began his financial career. ''I didn't want to join the socialists or conservatives to get a job,'' Huber recalls. Where would an ambitious young German-speaking financier head? Frankfurt, of course. Huber took a job in the German financial capital with accountants KPMG. His globe-trotting career had begun.

Today, the Salzburg-born Huber, 41, lives in England, works in Ireland, and reports to Spanish shareholders as CEO of one of Europe's fastest-growing online banks, Unofirst. He also is one of the Continent's most successful e-entrepreneurs, raising an astonishing $560 million to launch four companies that offer everything from savings accounts for individuals to investment-banking services for corporations. ''I feel like the new class of Europeans, who go where the job requires and are comfortable almost anywhere,'' says Huber, who, in addition to German, speaks English, Spanish, and French.

Huber's willingness to take positions far from home has speeded high-flying career moves. After working for 18 months in Frankfurt, KPMG moved him to New York. There he met his future wife, Amy Dodge. The couple moved to Paris. Soon afterward, he received an offer from HypoVereinsbank in Munich, where he convinced the board to set up a telephone banking subsidiary, a precurser to online banking. Dirk Anlage Bank soon became one of Germany's largest telephone banks. Huber built a home in Munich and prepared to settle down.

But then Fidelity Investments came calling with an unbeatable offer to lead up their European expansion--from London. He took the job, but when Fidelity retreated from Europe in 1997, Huber was fired, along with a half-dozen of his colleagues. The laid-off financiers took their generous severance packages, retreated to the room above Huber's garage, and came up with a new idea: an online bank venture aimed at Europeans everywhere but based in Dublin, where taxes are low.

This Euro-venturer hasn't lived happily ever after. Huber wanted to offer online customers interest rates higher than retail banks could afford because of their expensive bricks-and-mortar cost structure. But European retail banks are fighting back, opening their own online ventures and wooing customers with tempting offers. In England, Abbey National PLC has begun offering checking accounts with 4% interest, high by European standards and only 0.8% below what Huber can offer. ''It's war out there,'' complains Huber. He has been forced to scale back his expansion plans, delaying a planned opening in France and laying off 69 employees.

TERRA FIRMA. The ambitious Austrian is not giving up, however. He says his British and German operations still are signing up 1,500 customers a day, giving him a total customer base at the end of October of some 120,000. And he's joining forces with the giants. Earlier this year, Huber and his partners agreed to merge with Spain's giant Banco Bilbao Vizcaya Argentaria (BBVA) and Terra Networks, the top Internet service provider in southern Europe. The BBVA-Terra deal is scheduled to close in February, and the giant Spanish bank's support ''means we are in this for the long run.'' And his remaining 400 employees in Ireland, who come from all over Europe, are loyal. ''Gerhard has an enthusiasm that transcends borders,'' says Chris Kaiser, a co-founder of Unofirst.

Huber needs all the enthusiasm he can muster. Huber spends Monday and Tuesday in Madrid, Wednesday in Dublin, and Thursday and Friday drumming up business elsewhere on the Continent. His family continues to live in Surrey, England, not far from Gatwick Airport. Exhausting. Sure beats sitting in some old Vienna bank, though.

By William Echikson in Brussels

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