Building a future-ready bank
With the industry evolving at a rapid pace, automation is one of the most critical topics affecting the banking and fintech sector today. What's more, private banks these days are searching for better indicators that assist their efforts and quantify their performance in terms of revenue growth and profitability. Our selection of articles delves into details and delivers true insights and best practices.
To be successful in today's volatile business environment, European private banks need more than a compelling offering to attract and keep clients. According to McKinsey, "Firms need to recalibrate their financials to reflect higher interest income and lower recurring and brokerage income at a moment when many banks’ strategic plans call for expanding spending to revamp their operating models and technology capabilities."
In their concept of "A resilient framework for profit growth", they recommend a two-step approach:
"First, banks should develop a resilient framework for profit growth. Second, they should align on a strategic direction and desired future operating and business model—one that evolves logically from the current position defined by client profiles and bank resources. Such a strategy should ensure that the aspiration and the path to change are feasible and would result in the desired business outcome."
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With resilience?in mind, Taylan Turan, group head of retail banking and strategy, wealth and personal banking at HSBC envisions four areas for banks to focus on in 2023 in order to thrive:
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He explains the role of technology as a cornerstone:
"The last decade has seen consumer banking evolve at a rapid pace – with technology firms and fintechs embracing regulation and innovation to adapt to ever-changing customer expectations at breakneck speed. During this period, incumbents across the banking industry have invested heavily in digital transformation to close the gap with challengers." In connection to the concept of future-ready banks: "Investing in the right technology is clearly paramount in building resilience, especially for a retail bank. Technology and operational risk will continue to be an ever-evolving challenge as the bank of the future faces the tough balancing act of pivoting away from siloed systems to fully modular cloud-based solutions, while simultaneously ensuring operational resilience around the clock."
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In a piece for FinTech Weekly, two IBM consultants describe why automation, process mining and data analysis have the potential to redefine wealth management processes, thanks to process excellence:
"When we think about redefining wealth management processes, then process excellence appears to be a key differentiator. Process excellence is not all about specific techniques, it’s more about redefining the way enterprises generate and unlock value for their customers. Firms need to understand that productivity depends on efficient processes which means eliminating sterile processes, that is only possible when the process mining technique is administered to evaluate the efficiency of all existing processes including client onboarding, customer acquisition, and risk profiling, along with designing customized products and ensuring compliance to regulatory requirements."
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