2014 Banking Industry Outlook
Repositioning for growth
What investments are required today for tomorrow? Will they be sufficient in a VUCA world? Are they focused in the right areas?
Last year gave good reason for optimism. The ASX 200 index reached new highs. Consumer confidence improved. China introduced comprehensive reforms to revitalise its economy. Low interest rates and increased population growth boosted prices in many residential markets across Australia. The banking industry posted record annual profits and capital levels, and it was able to distribute record dividends to shareholders.
But it isn’t all up…
We all know that since 2007 the world has become increasingly regulated, with significant requirements relating to conduct, capital structure and liquidity. To add to the complexity there is still considerable anxiety as to how the timetable of the agreed regulatory reforms will play out in Australia as the new government begins to revoke some reforms and is considering others.
Financial Systems Inquiry
This year’s Financial Systems Inquiry - the first this century – is seeking submissions to identify the hurdles as well as the dynamics needed to support growth in the economy. It will look at how best to consider the innovations and technologies that are growing both domestic and international competitiveness in the sector, and it will explore the obstacles and any catalysts to funding, focussing again on evaluating essential and appropriate regulation.
The bottom line
Banking industry leaders will require across-the-board effort from their teams to:
- Enhance customer experience in new ways
- Leverage the regulatory climate into positives
- Use data insights to deploy capital more efficiently and create value management reporting
- Build organisational agility and innovation for organisational strategic effectiveness
- Link technologies to innovate and optimise performance across multiple dimensions In this 2014 Banking Industry Outlook we consider these topics in more detail.