Listen to this articleBanking executives are relatively confident in the growth of their industry, despite an evolving business climate.
That’s according to KPMG’s third annual Banking Industry Outlook Survey, which polled 200 bank executives on the sector’s challenges and opportunities amidst economic, regulatory and technological obstacles.
The survey found that most banks are embracing a future-forward approach by adopting the latest technologies and platforms. They are also “nurturing the right talent, culture, structure, risk management and governance” in an effort to optimize operations, strengthen trust and reveal new paths to growth.
“The path to growth for banks is accelerating their enterprise transformation to be the bank of the future,” Peter Torrente, KPMG US sector leader for Banking and Capital Markets, said in a company statement. “Modern technology platforms are the foundation, allowing banks to leverage the latest technologies to enhance operational efficiency, customer retention and attraction, and resilience through the next wave of challenges.”
Among the survey’s key takeaways are that two-thirds of bank executives are confident in their banks’ growth prospects. They identify cybersecurity risk (45%), interest rate risk (38%), and emerging/disruptive technology (30%) as the top risks to growth over the next three years.
The survey respondents are prioritizing investments in various digital channels this year, including online banking (62%), mobile banking (57%), open banking APIs (53%), and digital wallets (51%).
Some 65% say GenAI is an integral part of their institution’s long-term vision and strategy. Many banks are actively exploring and implementing GenAI to address cybersecurity (67%), fraud (51%) and compliance and risk (41%).
In addition, 80% of the banking executives polled think regulatory supervision and enforcement in the area of cyber risk will increase, while 78% believe their bank is adequately equipped to protect customer data, privacy and assets in the event of a cyberattack.
About half of the respondents are also making “significant strategic adjustments” in response to geopolitical uncertainty.
The KPMG national banking practice sees “significant opportunity for banks to choose change” and “embark on an accelerated journey of enterprise-wide transformation.”