IFRE.COM: Last week, the head of Singapore’s DBS Group, Piyush Gupta, sounded the alarm over shifts in the banking model that could push many banks out of business in a relatively short period. He spoke of the “cataclysmic disruption” facing the industry over the next five years and suggested that banks unable to adjust to this disruption over the next decade would “die”, adding that perhaps a decade was being a little too generous on the timeline front.
You don’t need to be reading the runes to see where he’s coming from. One area which is clearly facing a seismic shift is private banking, where online startups are threatening the bread and butter of the large European, American and Asian private banking operations.
The question is whether private clients – I’m thinking of those based in Asia – will be willing to eschew the handholding and bespoke service they get from private bankers in return for paying less in fees. I’m sure some will, and are already doing so. The rest will have to ask themselves some searching questions.
From the debt perspective there are a few areas that the online operations will not be duplicating. Not yet, anyway.
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