TSB Bank would not restrict its search for a strategic alliance partner to the finance sector and would consider linking with telecoms or retail businesses, its chief executive, Mr Harry Lorton, said yesterday.

The State-owned bank, whose proposed merger with another State bank, ACC, broke down last year, has begun a formal process to seek a partner. Addressing the Leinster Society of Chartered Accountants, Mr Lorton said: "We have no firm view that a partner must come within the financial services industry - telecoms or retailers, for example, could also prove attractive to us in this brave new world."

Describing modern banking as a "financial information business", Mr Lorton said IT and communications would enable a "near-perfect" market to emerge. But the business of established banks would be threatened because new players would be selective and cherry-pick attractive market niches, he warned.

"This will drive margins down further, allow new and innovative players to enter the market and put particular pressure on established ones, with their high cost bases."

But while technology would pro vide greater access to financial information, Mr Lorton said many customers felt overwhelmed by the array of goods and data.

"Paradoxically, the incredible volume of information available isn't necessarily as valuable as it might seem to be at first glace.

"Thus many of our customers will want - will need - personal contact and advice, and that is what our customer franchise in the future is based on."