Trésorier/Treasurer magazine - N°94 - Juil/Août/Sept 2016 - (Page 8)
CEO & Co-Founder
LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE
- JUL /
AUG / SEP 2016
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
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
Table of contents
FINANCIAL HIGHLIGHTS Luxembourg Tax News
INTERVIEW Philippe Gelis - Kantox - Fintech and the future of banks
Lost in transformation
Everything has a price – a transfer price
Treasury Survey - an unprecedented picture of treasury activities in Luxembourg
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
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
LIFE BEYOND NUMBERS
Trésorier/Treasurer magazine - N°94 - Juil/Août/Sept 2016