Financial Services

Banking in 2035: global banking survey report

November 10, 2022


Banking in 2035: global banking survey report

November 10, 2022

Yuxin Lin

Senior Manager, Policy & Insights

Yuxin is a senior manager on the Policy & Insights team. She leads research and analysis projects across a range of sectors including financial services, technology and NGOs. Based in Washington DC, Yuxin specializes in international trade and finance, demographics and workforce, emerging markets, and megatrends.

Prior to joining the Economist Group, Yuxin was vice president at FP Analytics of Foreign Policy, where she consulted with governments, international institutions and companies on trade, energy and social policies and investment strategies.

Yuxin holds an MBA from McDonough School of Business of Georgetown University and a BA in Management from University of International Business and Economics.

Recent years have offered banks object lessons in how to manage volatility. The covid-19 pandemic, Russia’s invasion of Ukraine, and the increasingly intense impacts of climate change are posing major challenges. In many ways, the banking sector has proven remarkably resilient to such risks.

Profitability in the face of a prolonged pandemic, for example, was higher than many observers expected, according to McKinsey’s most recent global banking annual Review. Yet the deeper structural challenges facing the sector—including digitalisation, fintech disruptors, digital currencies and growing cyberattack risks—continue to gather force. Steering a bank into the future has never appeared so tumultuous.

To understand how leaders view the trends that will increasingly reshape banking, Economist Impact, sponsored by SAS, conducted an in-depth survey in March 2022. More than 500 banking sector executives responded from organisations of various sizes around the world, including corporate, commercial, retail and digital banks. This report highlights some key findings from the survey and is complementary to the Banking in 2035: three possible futures briefing paper, which also explores the challenges and opportunities facing banks between now and 2035.

Key findings:

  • Bank leaders display cautious optimism about the future. They are generally positive about how some major trends— including digitalisation, digital currencies and the increasing importance of environmental, social and governance (ESG) issues—will impact their own organisation in the coming decade. At the same time, they remain conscious of growing risks from cyber-attacks and geopolitical uncertainty, among others.
  • Despite the optimism, various obstacles could prevent banks from staying competitive amidst these major trends as well as leveraging the power of data analytics. Challenges include siloed functions and departments, lack of relevant data to inform decision- making and customer concerns around the use of their data.
  • Digital transformation tops bank leaders’ mid-term strategic priorities. The majority (77%) believe that their organisation is on track or ahead in meeting its digital transformation initiatives and goals.
  • Purpose-driven banking represents an historic shift away from the longstanding shareholder governance model—and it is viewed positively by most executives. About three-quarter of respondents (76%) believe that their sector is obligated to address societal issues.
  • Translating such high-level support for purpose-driven banking into real action requires greater commitment and effort. Three out of five executives (64%) say that the financial services industry lags behind other industries in terms of progress on ESG goals and commitments, and only 38% say that their organisation has already established transparent and measurable ESG goals aligned with their corporate strategy.

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