IAFEI Quarterly - 32nd Issue

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Press, Journal Article
Context of treasury
Business context
SHUTTERSTOCK
FINTECH, APPLE, REGULATION – THE THREATS
LINED UP AGAINST THE MAINSTREAM BANKING
SECTOR ARE PERVASIVE AND FORMIDABLE. TIME
FOR A NEW APPROACH TO CUSTOMERS, SAYS
MICHAEL BARRINGTON-HIBBERT
38 The Treasurer March 2016
Warning:
evolution
needed
As banking consumers,
we shop around for
the best deal. We may
have a current account with
one provider; an ISA and
mortgage with another;
and savings, loans and
investments with diferent
providers again. We know
that it is prudent to review
our inancial management
regularly. So, why are
corporate banking trends
behind the curve?
The democratisation of
the inancial services sector –
mainly due to the accessibility
of information online – has
introduced the notion of a
‘shared economy’. Customers
put their trust in independent
and niche companies more
than ever before; we know
how to do our own research
and due diligence.
These consumer banking
trends have had a knock-
on impact on the corporate
banking and investment
market, but many banks
have been slow in responding
to market needs. The
result is that some former
market leaders are inding
themselves under threat from
challenger brands coming
into this sector.
Loyalty for one single
provider is diminished due
to the ever-growing choices
we are ofered as individuals,
and the same is true for
businesses and corporations,
irrespective of long-standing
relationships with banks.
Many of the corporate and
investment banks that
have continued to stick to
traditional product oferings
and service experience are
now inding themselves under
pressure due to changes in
client appetite.
With continued and
sustained low interest rates,
de-risking and the threat of
challenger brands eroding
their market share, many of
the corporate banks are now
looking to deine their own
unique and diferentiated
strategy in order for them
to remain relevant. Recent
research suggests that, by
2020, players in alternative
banking will be worth €7bn,
ofering customers a suite of
products and services tailored
to their speciic needs.
Corporate clients will be able
to cherry-pick services from
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