2016

Staying top of mind during the age of analytics

What we’ll cover today:1. The state of the industry Mobile, branches, millennials

2. Insights from thought leaders Credit cards, big data, blockchain

3. Core banking topics Payments, lending, investments

Let’s look at the state of the industry

Banking is at an inflection point.

The future holds big wins or rapid failure depending on the choices financial institutions make today.

Silicon Valley is coming. There are hundreds of startups with a lot of brains and money working on various alternatives to traditional banking.

- Jamie Dimon, CEO of Chase

Fintech is chomping at the fringes.

Investment in fintech has ballooned…

…as the financial industry consolidates.

The rise of passive investing threatens investment bank revenue.

The rise of passive investing threatens investment bank revenue.

Big changes are still to come…

Up to half of the world's banks will disappear through the cracks opened up by digital disruption of the industry.

- Francisco González, Chairman and CEO of BBVA

Technology is changing how companies are organized and run across all industries, and ours is no different.

- Brian Moynihan, CEO of Bank of America

We could go the way that file transfer technology changed music, allowing new businesses like iTunes to emerge.

- Michael Harte, Chief Operations and Technology Officer at Barclays

“Who saw Uber coming on so quickly? ... It’s a safe bet that the thousands of cab drivers in big cities didn’t have an inkling of how fast Uber would disrupt their traditional business.”

- KPMG

You probably never thought of Uber as an acquirer of small business bank accounts, but if you’re an Uber driver and Uber can give you a debit card that enables you to get paid — then why would you go to a bank branch to open an account instead?

- Brett King, author of Breaking Banks

Consumers seek easy solutions.

Mortgages at a Click of a Button

Quicken Loans Super Bowl ad for mortgages at a click of a button

Financial institutions are changing their game plan…

They know they need to focus on profit

They’re investing less in branches…

…and more in digital.$131 billion: Total IT budgets in the retail banking industry in 2015 — a 4.3% increase over 2014.

– Ovum Research

Technology investment skyrocketed from fourth priority in 2014 to first priority in 2015.

- Temenos

Branches continue to be a burden

Branches continue to be a burden

Users want a better digital experience

38% of consumers have reduced how often they bank somewhere because of a poor digital experience.

MX Consumer Survey

Consumers are getting increasingly picky

1. Monitor all accounts in one place2. Anywhere, anytime3. Move money when and how they want it4. Security5. Make it easy, make it work6. Being able to view and do (action it)

What consumers crave from digital

- Javelin Strategy & Research

71% of consumers believe their relationship with their bank is only transactional.

The focus should be on advocacy

- Accenture

It’s clear that the best path forward is advocacy—adding real value that enriches lives and overshadows any rival experiencethat competitors provide.

- Javelin Research

What to look forin 2016

1. Fintech + FI partnerships

We have a whole team of people helping fintech companies be successful, and we think that’s a big area for growth for us for the coming years.

- Gary Becker, CEO Silicon Valley Bank

Throughout 2016 you will hear about banks creating accelerator startup funds, co-investing with young, ambitious entrepreneurs.

- David Horton, Head of Innovation at Synechron

“2016 will see more banks partnering with startups in a quest to get to market faster than their legacy systems currently allow.”

– Louise Long, Head of Human-Centered Design at Nab Labs

What to look forin 2016

2. Blockchain

The biggest idea in banking right now is blockchain technology.

- Brad Leimer, Head of Innovation for Santander Bank

Suits are replacing hoodies and ripped jeans at blockchain conferences.

- Mark Buitenhek, Head of Transaction Services at Dutch bank ING

You should be taking this technology as seriously as you should have been taking the development of the Internet in the early 1990s.

- Blythe Masters, CEO of Digital Asset Holdings

What to look forin 2016

3. The Age of Analytics

We believe we are entering the 5th era of banking

The Baronial Age

The Diplomatic Age

The Casino Age

The Digital Age

The Analytics Age

Netflix, like Amazon, is a flywheel that keeps spinning faster: As it gets more subscribers, it gets more data and more money to fund more content, which in turn helps it bring in more customers, and on and on, ever faster.

Big data is the future. Will banks crack the code?

- Farhad Manjoo, NYT Columnist

2016 will be the year when data and analytics finally get a decent, well designed front-end.

- David Horton, Head of Innovation at Synechron

“Contextual data analytics will introduce more intelligence into each customer contact, laying the groundwork for augmented intelligence towards the end of the decade.”

- Chris Skinner, author of Digital Bank

“Remember when the question was: “Where do you bank?’’ Not any longer. Now, it’s more likely: “How do you bank?’’

- KPMG

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