The financial services industry is facing its greatest challenge in a lifetime. As the industry rebuilds, members of our financial services networks explore new ideas for addressing a crisis in governance, management, and perception.
Large, international banks are working to overcome significant strategic and operational challenges, including developing business models that will achieve sustainable returns as the benefits of scale and global scope are increasingly challenged. They must also demonstrate to regulators and investors that they are not “too big to manage,” as they navigate a challenging cultural and business model transformation. The sixth annual Bank Directors Summit focused on the continuing centrality of regulation as a driver of change in the industry, the strategic transformation underway in banks, and the ongoing evolution of expectations for boards.
International reforms have been underway for six years, and many policy decisions have been taken, yet the full impact of implementation is only now becoming clear. New regulations, including calls for local capital, liquidity, and governance, and recovery and resolution planning are driving changes to bank business models, with international, diversified banks experiencing the greatest impact.
Bank leaders are redefining growth and return objectives, and developing sustainable models for achieving those. Global banks face particular challenges in reevaluating structures and models for delivering products and services in multiple markets, as the benefits of scope and scale are challenged. The threats and opportunities of digitization are particularly important to future operations, as is having the right people in place to lead transformation efforts.