Dutch bank ABN AMRO celebrates 25 years in business in Ireland this week and is already talking about holding a bigger bash in 2022. In Dublin to join in the celebrations, one of its most senior executives, Mr Michael Drabbe, says the Irish operations now rank among the top performers in the worldwide ABN AMRO group and are likely to continue to expand over the coming years. Its experience in Ireland has largely been good, he says, and the bank expects to enjoy many more prosperous years here.

In 25 years, the bank has come a long way, both in terms of its presence in Ireland and in the wider international markets. It set up here in 1972 as part of a policy to have a branch in each of the then European Economic Community states.

Starting off with about 20 people, it opened a relatively small bank, largely focused on providing financial services to Ireland's agricultural sector in 1972. At that time this was seen as a logical extension of the bank's business, which had a long association with the agri-sector in the Netherlands.

"We have helped many of the Irish dairy companies to expand into Europe and still have relationships with most of the leading players in this field," Mr Drabbe says. Over the years it has also forged relationships with most of Ireland's financial institutions and building societies and has become one of the main providers of financial services to Irish-based multinationals.

Today it employs 200 people at the International Financial Services Centre, which includes its corporate finance, private banking and retail banking divisions and its stockbroking arm, Riada.

"The Irish business is now among the top performers within the group. As with everything it has had its good and bad times. We reorganised the Irish business in the 1980s, closing the Cork branch, but since then business has been good. It has delivered a very solid performance for the group."

The Irish operations are, of course, only a small part of the huge ABN AMRO international empire. Employing 74,000 staff in 71 countries it has total assets of almost $400 million and is ranked as one of the major world banks.

With a presence on all continents, Mr Drabbe says its most immediate challenge is to become Europe's major bank, something which he believes it can achieve after the introduction of the euro.

"No other bank has branches in each of the EU states. If we are linked to all of the European clearing centres, then we will become the biggest player."

Already the bank is spending considerable resources on preparing for the transition to the single currency. Over the next year to 18 months it will be spending $250 million on converting its European operations to accommodate the euro and to develop euro-based financial products.

The new currency, he suggests, may initially prompt a downturn in its overall profits, adding significant costs as well as abolishing its highly lucrative foreign exchange business, but in the long term the benefits will be great.

"We will lose our foreign exchange component, which will immediately reduce group turnover by between 10 and 20 per cent. But I feel that over time the opportunities will be greater than the losses. Ultimately our clients will benefit from the euro and by extension so will we."

Its treasury operations throughout Europe will be scaled back and in some cases will totally disappear, but he believes this will be largely compensated by rapid growth in investment banking and corporate finance activity after European Monetary Union.

Mr Drabbe suggests that in the coming years the bank will have to consider creating a centralised European operation. "I believe that such a centre will emerge within five years. Where this will be located will largely depend on the availability of skilled staff, relatively low cost factors and the prevailing fiscal environment at that time."

Mr Drabbe says ABN AMRO's clients in the Netherlands are completely resigned to the euro, with virtually no one giving it a second thought. "Even the corporate markets, Britain included, are in favour of it. There is a view that it will be an enhancement of efficiency in every shape and form."

But he notes the widespread concerns among the bank's European client base about the costs that adopting a new currency will incur. "People are especially concerned about the cost. They have to prepare for the year 2000 as well as the euro. Of course those who will be bear most costs will be the financial institutions."

However, Mr Drabbe suggests that most companies and financial institutions will be able to bear the inevitable costs involved in the phasing in of the euro. But he warns that the next phase could create difficulties.

"In the longer term it will create financial problems, particularly for the smaller banks. They will be forced to operate in a more transparent marketplace where consumers will have greater choice to buy financial services throughout Europe."

He believes that the wider European market will still continue to operate on a regional basis for some time after the initial inception of the single currency though. "The huge differences between the legal and fiscal environments in the various EU states will ensure that regionalisation will exist for some time, as it has in the US."

To stay ahead of the game in Europe, ABN AMRO will also be increasingly focusing its efforts on acquisitions in the emerging European markets, which over the next 10 years will almost certainly join the EU.

The bank recently purchased the third largest bank in Hungary, and is actively looking for a suitable acquisition in Romania and Poland, he says. While beyond Europe, it will continue to aggressively grow its US business and is also seeking alliances in Asia.

Its agenda for the next 25 years is already firmly set.