challenge 1: pruning for growth and distinctiveness (top 10 challenges for investment banks 2017)

TOP 10 CHALLENGES

CHALLENGE 01 - Top 10 Challenges for Investment Banks

CHALLENGE 01

PRUNING FOR

GROWTH AND

DISTINCTIVENESS

TOP 10 CHALLENGES FOR

INVESTMENT BANKS 2017

#IBTOP10

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10 GETTING FIT

AUTOMATION

LOCATION STRATEGY

DIGITAL TALENT

CLIENT EXPERIENCE

JOURNEY TO CLOUD

INNOVATION

RESEARCH FUNCTION

BLOCKCHAIN

PRUNING FOR GROWTH

AND DISTINCTIVENESS

3

PRUNING FOR GROWTH

https://www.accenture.com/us-en/insight-top-ten-challenges-investment-banks-2017


PRUNING FOR GROWTH

AND DISTINCTIVENESS

INVESTMENT BANKS MUST ASK THEMSELVES:

In the post-financial crisis world, regulation,

market structure and technology continues

to change at an accelerated pace.

How is the

market evolving?

Where is

value migrating?

How can I regain

a competitive

advantage?

4CHALLENGE 01 - Top 10 Challenges for Investment Banks




PRUNING FOR GROWTH

AND DISTINCTIVENESS

As regulatory burdens grow, compliance costs

are stacking up. As volumes and margins

decline, revenue pools are shrinking.

IT’S TIME FOR INVESTMENT BANKS TO:

Prune product offerings

and business lines

Strengthen

core businesses

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PRUNING FOR GROWTH

AND DISTINCTIVENESS

In the past, investment

banks have focused on:

And set themselves

apart with:

When traditional routes to innovation are no longer

an option, what’s an investment bank to do?

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PROFESSIONAL INVESTORS

FINANCIAL INSTITUTIONS

CORPORATES

BESPOKE PRODUCTS

NICHE HIGH-RISK PRODUCTS




PRUNING FOR GROWTH

AND DISTINCTIVENESS

Reigniting growth by identifying

one’s strengths, aligning the business to

those strengths and developing business

and operating models that build on and

advance those strengths sounds

deceptively simple.

But it requires investment

banks to ask themselves

three difficult questions.

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QUESTION 1:

WHICH ELEMENTS OF OUR OFFERING

DO CLIENTS TRULY VALUE AND PAY FOR?

Pre-trade MiFID II will require many investor clients to pay for research.

Sales’ ability to add color on flows is increasingly limited.

Trading More products are moving closer to quasi-agency territory.

The street is relying more heavily on buy-side liquidity and platforms.

Post-trade End-to-end client experiences, efficiency and connectivity have roles to play.

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QUESTION 2:

WHAT DOES THAT MEAN FOR CLIENT

FOCUS AND FRANCHISE?

Client value Does the balance between corporates and investors need to shift?

Client service Can digital distribution and local partnerships help absorb counterparty risk?

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QUESTION 3:

HOW DO WE RECONFIGURE OUR

OPERATING MODEL AND COOPERATE

ACROSS THE ECOSYSTEM?

Investment banks can enable small regional players, and leverage the

power of fintech and the surrounding ecosystem, in one of two ways:

Focus on advanced products and solutions and effectively outsource foreign exchange and rates trading.

Become a platform player that offers a full range of trade services and lets other players plug in their areas of value.

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PRUNING FOR GROWTH

AND DISTINCTIVENESS

THERE’S NO RIGHT

OR WRONG ANSWER

The decision won’t be black or white

THERE’S A CONTINUUM

OF OPTIONS

Where you choose to play will depend entirely on you

Some players are integrating core businesses

to deliver more services to more people

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WHERE WILL YOUR INVESTMENT

BANK BE AT HOME?

What makes most sense for you?

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EXCEL AT

THE CORE

FOCUS ON

CORPORATES

FOCUS ON

INVESTORS

PLATFORM

PLAYER

Focus on sophisticated, highly customized solutions for large and professional investors, financial institutions and corporates

Fully-integrated, seamless service delivery to corporate clients across all products

Leverage digital to service the broader investor universe beyond traditional buy-side clients

Offer best-in-class products via peer platforms, connecting to the core




PRUNING FOR GROWTH

AND DISTINCTIVENESS

Large Investment

Banks May Combine

MULTIPLE ELEMENTS

Small Investment

Banks May

NEED TO FOCUS

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PRUNING FOR GROWTH

AND DISTINCTIVENESS

Where to play and radically simplify

their operating models accordingly.

What’s most important is that

you choose a clear direction

and map your path there.

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TAKE THE

NEXT STEP

www.accenture.com/10challenges

CHALLENGE 01 - Top 10 Challenges for Investment Banks 15

https://www.accenture.com/us-en/insight-investment-bank-challenge-01-growth?c=fs_cmfy17sldshr_10000001&n=smc_0517



challenge 1: pruning for growth and distinctiveness (top 10 challenges for investment banks 2017)

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