fall from $34 to below $1 in less than a year.

The company, which has Bank of Bermuda and Lines Overseas Management as its major shareholders, must now improve its share price to more than $1 in order to meet listing requirements, according to the monthly newsletter InsideBermuda.

The company's share price hit rock bottom in December, trading at 59.4 cents a share. In February of 2000 the shares were at an all-time high of $34, just months after the stock was launched on the Nasdaq.

The company, which provides a payment processing service to banks and their merchants for on-line transactions, has among its main shareholders Bank of Bermuda, which owns 10.42 of the company, and Lines Overseas Management, which owns 13.23 percent.

According to InsideBermuda, the average purchase price of LOM stock was $7.50 per share, and Bank of Bermuda paid on average $7 a share.

First Ecom sees shares slide The magazine added: "Only five months ago, the Bank of Bermuda bought its second tranche of one million shares for $7.8 million at $7.80 per share.'' After reporting poor third quarter financials last month, the company vowed to lower its expenditure to make sure its share price rose again.

But it has gained only 13 cents since its all time low in December, rising to close at just below 72 cents yesterday In a filing to the Securities and Exchange Commission the company promised to cut staff and the salaries of senior management by a third. Most of the staff are based in the company's headquarters in Hong Kong.

The company also said it would bring in external consultants to review the company's sales strategy.

The filing stated: "The Company has begun to streamline operations in order to reduce overall operating costs. The cost cuts include a reduction in staff of approximately thirty percent. Senior management has also agreed to a one third reduction in their salaries.'' It added: "The board approved the selection and appointment of a major independent consulting firm to review the company's operations in order to improve the implementation of the company's business plan, maximise operating efficiency and increase sales.'' The company has been through changes recently, stating: "There were changes to the board of directors with a view to enhancing corporate governance.'' Gregory Pek was replaced as chairman by Ermanno Pascutto and Ian Robinson was appointed Vice-Chairman.

Mr. Pek will remain on the board as a director. The company said he would continue to serve as President and co-Chief Executive Officer along with Ravi Daswani who also continued to serve as Chief Operating Officer.

"These are very positive steps that the board has taken in restructuring and focusing the Company,'' said Mr. Pek in the filing. "The fact is that the payment processing business is one that takes a lot of up-front investment but can be very profitable over the long term. And we have to think long term.

"The cost cuts announced today are designed to make sure that we have the capital to execute our business plan and attain profitability. Given today's market environment it is prudent to preserve our strong cash position.

Reductions in staff numbers are regrettable but necessary in the current market environment. We must focus on core competencies that will drive sales and bring banks online, thereby delivering real shareholder value.'' Mr. Pek added, "Another area that we are examining is our communication with the market. During the last few weeks we've had considerable shareholder feedback about this. Part of the review will focus on improving such communications.

"Our customers are banks and financial institutions. We see that they are approaching the Internet and e-commerce with more caution now. We believe that in the long run there will be a flight to quality in all aspects of out sourcing including our area of electronic payment processing and I believe that this is going to benefit us.'' Downward slide: First Ecom's stock performance.