Global Trends and Disruptions for financial institutions of tomorrow

Chairman, Royal Bank of Scotland

Moderator: Navneet Munot, CFA, CIO, SBI Funds Management Pvt. Ltd.

  • The re-regulation of traditional financial firms since the crisis has been dramatic. Higher capital ratios for banks and tighter solvency rules for insurers. And there is still pressure for more capital and tighter consumer protection rules. Does this increased regulatory burden risk making conventional financial institutions uncompetitive? The low valuations of banks, especially in Europe, suggest that many investors think so.
  • Very low, or even negative interest rates in Europe and North America, are a huge challenge for banks, insurers and investment managers. Are some business models now unviable, when short-term interest rates are negative and the yield curve is flat?
  • The fintech resolution is gathering pace. Companies like Ant financial now have hundreds of millions of customers in China. Small fintechs in North America and Europe are eating into profit pools traditionally monopolised by banks and insurers. And the threat from ‘Bigtech’ is even more worrying. Google, Apple, Facebook and Amazon have huge financial resources and millions of customers already and are beginning to add financial services offerings. How should banks respond to these new competitive threats?