Trésorier/Treasurer magazine - N°94 - Juil/Août/Sept 2016 - (Page 8)

INTERVIEW With Philippe Gelis, CEO & Co-Founder of Kantox LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE - N°94 - JUL / AUG / SEP 2016 FINTECH AND THE FUTURE OF BANKS 8 We all talk about FinTech and how disruptive they can be, especially for banks. Do you think banks are under threats and at risk? Definitely. Let's be clear, big global banks will not disappear, but small and medium banks, which have not enough resources to transform themselves and go digital will be in big trouble. Regarding big banks, they will lose a big chunk of revenue due to fintech but in the end they will adapt. There is a recent study from McKinsey saying that banks will lose on average 40% of revenue and 60% of profits until 2025. They need to re-invent themselves, close 80% of branches and learn how to be attractive for millennials and digital born people. It is a complete different landscape, transparency, fair products and prices are becoming the norm. Do you think banks are reacting and are fast enough to prevent potential loss of businesses? Oligopolies are always slow to react to disruptors by definition. But if you compare to the press or music industries for example, I would say that banks have moved quicker. Two or three years ago they were still in denial of the Fintech phenomenon or they were trying to slow down fintech companies. Now they have understood that there is no way back and that the future will be competition or a mix of competition and collaboration with Fintech. Fintechs are small but they are fast, flexible and disruptive. Banks on the contrary are giants with huge customer bases but they do not know how to serve well these customers and adapt. They will both benefit of co-petition. Banks need to re-invent themselves, they need to change their corporate culture, they need to become agile and open. We saw some banks investing in FinTech. Is it the right strategy in your views? It is one strategy but it is definitely not enough. Banks need to re-invent themselves, they need to change their corporate culture, they need to become agile and open. Investing in Fintech is a right thing to do but they also need to partner with Fintech on product development and distribution, they need to "refresh" their brand and culture, they need young people to lead the change inside the bank and to dramatically lower the average age of their board. The financial regulations and economic situation have put more pressure on banks and have made FX hedging more and more expensive for corporates. Therefore, it should be all benefits for peer-to-peer solutions like KANTOX, isn't it? Indeed. Banks are now "paying" for all the excesses of the past (sub-primes, Liborgate, FX manipulation, etc.) and regulators have decided to over-regulate to avoid being considered responsible of another financial crash as it happened in 2008. If you think about the cost of hedging for corporates, banks are simply trying to increase margins on something that is now consuming much more capital than before and thus that is more expensive to offer. Any new developments in your sector or in services you offer that we should explain to our readers? What we have learned in the last 5 years is that FX for corporates, in particular hedging, is still a way too manual process. Identifying FX exposure, monitoring FX risk, setting-up a hedging policy and then executing depends a lot on human decisions and manual processes. Corporates have focused too much on price.

Table of Contents for the Digital Edition of Trésorier/Treasurer magazine - N°94 - Juil/Août/Sept 2016

Cover
Table of contents
EDITORIAL
FINANCIAL HIGHLIGHTS Luxembourg Tax News
INTERVIEW Philippe Gelis - Kantox - Fintech and the future of banks
FOCUS
Lost in transformation
Everything has a price – a transfer price
Treasury Survey - an unprecedented picture of treasury activities in Luxembourg
FORUM
The impact of negative rates on Treasury and Risks Management Systems
Towards reporting harmonisation?
Understanding the Treasury impact of BEPS
Impacts of Single Resolution Mechanism and Bail-in for European Banks
Supply chain? Not concerned?
Collateral management and the Corporate Treasury function.
Efficiently Managing Cross-Border Payments in Turbulent Times
CORPORATE FINANCE
How Mid-Market Companies Can Efficiently Manage Enterprise-wide FX Risk as they Grow
Investing surplus cash in repos
A wind of technology changes in the treasury management world
Invoicing can be fun….?
Comment améliorer la performance des fonds de pension européens
15 MINUTES WITH O2Finance
THE FINANCIAL RISK OBSERVATORY
NEWS
LIFE BEYOND NUMBERS

Trésorier/Treasurer magazine - N°94 - Juil/Août/Sept 2016