Europe's largest bank, Deutsche Bank, says it plans to invest up to 1bn euros every year in internet ventures.

For starters, the German bank announced partnership deals with online service provider AOL Europe and business computing firm SAP, which is one of the world's largest software companies.

'Global E'

Deutsche Bank's chairman, Rolf Breuer, said the internet was "affecting the financial services sector more than any other industry. It will radically alter the banking landscape over the next few years.

Describing his plans as a "Global E strategy", Mr Breuer promised that the investments would "dramatically transform Deutsche Bank's businesses".

He added that his bank's e-commerce ventures would be partially funded by redirecting expected profits from the sale of the bank's huge portfolio of industrial share holdings.

Once Deutsche's internet operations have taken off, they could be floated on the stockmarket, the company said.

To ensure the project's success, all e-ventures will be run on a swim-or-sink basis. "Less promising programmes simply won't move forward", Mr Breuer said.

The German government recently announced plans for a tax reform that would scrap capital gains tax on the sale of share holdings. Once law, Deutsche Bank could lock in the gains from its stakes in a large number of firms across German industry, and invest the money in e-commerce ventures.

Web alliances

Deutsche's first steps into the world of e-commerce are two giant leaps, one into the business to business market, the other into consumer finance.

Linking up with enterprise software group SAP, Deutsche Bank will provide financial and trading services on the MySAP.com internet platform.

MySAP is an exchange for ideas and services and a meeting place for by firms that use SAP's enterprise software to run their operations.

Companies using MySAP could organise their banking business with Deutsche Bank through the web site.

Gaining 3.8 million potential customers with the click of a mouse, Deutsche Bank's telephone banking unit DB 24, also struck an alliance with internet service provider AOL Europe.

Deutsche will offer online banking and brokerage services to AOL's European customers, 1.8m of which live in Germany.

Mr Breuer said it was "absolutely necessary to build strong partnerships" in order "to stay at the forefront of the world race for e-business".

Internet rush

Other banks are rushing to join the online race.

German rival HypoVereinsbank has said it will invest 100m euros this year to implement its internet strategy.

Commerzbank announced last week a partnership with Europe's largest internet service provider, Deutsche Telekom's T-Online.

UBS of Switzerland promised to deliver online financial information for mobile internet pages that can be accessed through phones using the Wireless Application Protocol (Wap).