While banks are still riding the tide of revenue and margin growth on the strength of higher interest rates, the current banking business model isn’t bringing in the necessary return on equity (ROE), valuations, and price-to-book ratios, nor is it driving sustained growth and profitability.
Amid risk and volatility, there’s an opportunity for banks to use higher margins to lay the foundation for long-term growth and profitability and scale the business beyond banking. However, it requires them to shift toward a radically new business model, one where they use their real competitive advantage—data and technology—to build a resilient bank, rewire for operational efficiency, and shift to put business model innovation and people-led experiences at the core. And they must do this while meeting environmental, social, and governance (ESG) goals.
See what challenges banks need to be address and how to evolve beyond the “utility bank”