The Future of Finance 2025: Fit for Growth, Built for Purpose (Boston Consulting Group)

Summary

• Banks delivered 30% TSR globally from June 2023 to June 2024, compared to 19% for the market as a whole.p.5
• Banking industry revenue has grown at a CAGR of 4% over five years, with net interest income contributing approximately 85% of the growth.p.6
• Noninterest income grew at a CAGR of just 1.8%, with noninterest income productivity decreasing by 18% over the five-year period.p.6
• Stablecoins currently have a market cap of roughly $200 billion.p.11
• Estimates suggest that $19 trillion in assets could be tokenized by 2033.p.12
• In Europe, 67% of banks are trading below book value.p.19
• More than 60% of bank tech spending goes to run-the-bank maintenance; this needs to change to 40% of spending and 75% of staff doing rather than managing.p.24

Key insights

1. 20% to 30% of retail customers in Germany now have an account at a direct bank or neobank.p.10
2. Retail trading accounts for approximately 20% of US equity trading market volume, double its level of a decade ago.p.9
3. Distributed ledger technology could unlock $20 billion annually in global clearing and settlement costs.p.12
4. Cumulative inflation in the Western world since 2021 is 22%, yet most banks have not passed costs along to customers.p.16
5. Banks often negotiate away 30% to 50% of value during the sales process.p.16
6. Only 25% of banks leverage capability and innovation hubs as a customer experience and tech-led center, compared to 40% of technology firms.p.27
7. Digital champions sustain front-to-back digitization programs for five to seven years before reaping the full benefits.p.26