Lessons from COVID-19 and bold moves for an uncertain future

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Lessons from COVID-19 and bold moves for an uncertain future

2021 Banking and capital markets outlook

2020 has taught us some valuable lessons. Without an existing playbook, banks were forced to dismantle traditional constructs and friction in favour of clarity and agility. Going forward, it is pivotal to institutionalise these learnings to prepare for an uncertain future. How to strengthen resilience and accelerate transformation in talent, operations, technology, finance, and risk?

A more equitable and sustainable society

Banks will need to confront ongoing challenges from the pandemic and boost their resilience. After all, the pandemic may be a formidable test right now, but others, such as risks from climate change, are no less daunting. Banks have embraced their social purpose with a new energy and focus, contributing to a more equitable and sustainable society. For instance, they can help reallocate capital toward economic activities with a net positive to societies, and they can nudge new behaviours among clients and business partners. Regulators around the world will certainly appreciate this.

The challenges of digital customer engagement

COVID-19 has turbocharged digital adoption across products and demographic segments, both in retail and in commercial banking, from mobile app usage to mobile check deposits and digital roadshows. The big question is: will this increase of digital customer engagement last? Banks would benefit if most of their customers transitioned to digital-only, self-service interfaces (with significant cost savings), but digital engagement does not necessarily translate into increased customer satisfaction. What should banks do to enhance satisfaction as well?

Talent, operations, technology, data, and risk

Banking leaders around the world have faced various challenges in the field of talent, from shifting to a remote, distributed workforce to keeping employees engaged and productivity high. How will these changes transform talent models in banking? The pandemic may also have highlighted the need for a stronger focus on business continuity planning, crisis management, recovery, vulnerabilities in global footprint and dependence on external provider networks. Strengthening operational resilience – and agility, which often goes hand in hand with resilience - will therefore likely be a major banking issue. How to handle this challenge? Other pivotal questions are related to technology (legacy infrastructure, data fragmentation across the enterprise), strategic (forecasting) value through data, and transformation of risk frameworks.

Key actions

In Deloitte’s “2021 Banking and capital markets outlook”, these challenges are addressed in full detail, along with key actions to consider in various business segments. The publication contains strategic and operational priorities to consider in 2021 for retail banking, payments, wealth management, corporate and transaction banking, and capital markets. Please find the full report.

2021 Banking and capital markets outlook
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