One of the UK's oldest institutions has agreed a five-year IT outsourcing contract with Capgemeni.

C Hoare & Co, a privately owned bank founded in 1672, will hand over responsibility for its IT operations to the consulting and technology firm from next month.

The outsourcing deal is expected to free up the bank's office space for other commercial activities, in addition to simultaneously providing significant cost savings and a high quality of service for clients.

Alexander Hoare, chief executive of C.Hoare & Co, said: "Our strength as a bank lies in our provision of first-class personal service to our clients.

"We are confident that working with Capgemini will maintain and enhance the IT service which provides vital underpinning for our work."

Forrester Research valued the UK outsourcing industry at £3.8 billion in 2007. This £1 billion year-on-year meant that Britain accounts for nearly half of all the deals completed in Europe.