The outlook for deposits should be at the top of bankers’ minds following the Bank of Canada’s recent rate hike, which represented its fourth — and a cumulative 100 bp — move in the past year.
In this issue, we tackle some key topics that you will face as you look to the future of banking. We guide you through some strategic choices that you will likely have to make, such as developing a thin-branch network or launching a direct bank. We also examine the significant amount of churn that will hit your workforce and provide guidance about figuring out which deposit customers are most valuable to you.
The U.S. banking industry has always followed a very simple formula: Intermediation 101 calls for banks to gather deposits from local depositors (primarily retail) and lend to local borrowers (primarily businesses).
The Novantas Review is pleased to introduce a new feature in which we interview an expert about the banking industry.
The Details are in the Data
As more Millennials* seek “must have” mobile banking services, they increasingly want to be untethered from their bank’s physical locations. More than three-quarters of them would consider a bank that doesn’t have branches.
Much of the buzz about real-time payments innovation has focused on retail banking, but the new technology has broad implications for commercial businesses as well.
Although regulator-driven at the outset, quantitative thinking is now firmly in the DNA of many banks. As a result, many are struggling to manage hundreds of models that require an increasing number of resources.
It’s no secret that the need for low-cost, sticky deposits is one of the most pressing issues in the industry today, particularly as interest rates are set to keep rising. The use of deposit scoring can help banks identify which customers they want to keep — and the best ways to keep them.
The LIBOR-OIS (London interbank offer rate-overnight index swap) spread has widened dramatically this year, prompting speculation that the next crisis is on the horizon.
As consumers spend less time in branches and increasingly turn to non-bank providers for day-to-day cash management, banks must stay relevant by tapping into the emotional and financial needs of their customers.