Banking Transformation: The New Agenda (KPMG)

Summary

• Only 24% of surveyed banks report being highly successful in achieving their cost reduction goals.p.5
• 53% of banks expect to cut costs by 10% by 2030, while 29% aim for cost reductions of more than 20% by 2030.p.5
• Embedding AI into new ways of working is selected as the top area of strategic importance by 38% of bank leaders.p.8
• Nearly half of all banks believe they can grow their earnings by more than 2.5 percent over the next three years.p.7
• 80 percent of survey respondents report plans to accelerate existing cost reduction initiatives over the next two years.p.10
• Three-quarters of surveyed banks invest more than 15 percent of their operating budget into transformation initiatives.p.15

Key insights

1. Only 18% of surveyed banks have been highly successful in achieving their overall transformation goals.p.5
2. Addressing cyber security and fraud is prioritized as an area of strategic importance by 33% of respondents.p.8
3. Mid-sized banks set the most aggressive targets, with 88% aiming to cut costs by 10% or more by 2030.p.9
4. Introducing greater process automation is identified by 38% of banking leaders as providing the single biggest benefit to profitability.p.13
5. Half of the surveyed banks have already adopted AI and automation for fraud detection and document processing value chains.p.14
6. Only 31 percent of respondents report that their cost reduction strategy and transformation goals are fully aligned.p.19
7. Centralized execution of transformation strategies is rated as highly effective by 50% of the respondents who use it.p.20
8. Managing a significant change portfolio and the need for prioritization are cited by 53% of respondents as a major barrier to transformation.p.21