Global Banking Industry
In the global banking industry (one of the major segment of the financial services sector), bank credit represents the leading market segment, with around 60% of the overall market in terms of value. The EU is the largest regional market, with over 57% of the global market.
The economic recession that began in 2008 resulted in the crash of several financial institutions, which in turn led to the examination of practices and deployment of new guidelines in the banking industry. The sector is beginning to rebound, and cross-border investment is one area contributing to recovery, with a few large banks dominating certain national markets. Advantages of cross-border practices include economies of scale, though institutions must compete with established domestic banks.
Key Bank Market Segments
The world retail lending sector was worth close to $31.4 trillion in 2010, reports MarketLine. Mortgage lending represents the leading market segment, and reached close to $24 trillion in 2010, accounting for almost 76% of the overall market in terms of value.
The global credit card market is benefiting from Long Term Evolution rollout worldwide, state support and migration to Euro pay, MasterCard & VISA (EMV).
Obstacles to the global mobile payments market growth include the low penetration of contactless terminals and handsets in mature markets.
The world near field communication (NFC) payment market growth will be fuelled by the increased availability of NFC-enabled handsets. While NFC-enabled payment pilot trials have proved successful, additional infrastructure will be necessary to fulfill growth potential. Key companies operating in the global NFC payments industry include Discover Financial Services, MasterCard, and Visa.
The global private banking sector has been seriously impacted by the economic crisis, following which partnerships, organic growth, and mergers and acquisitions went into decline, according to research from Datamonitor. Since 2010, private banks have been struggling against commoditization. Industry players will continue to concentrate on customer segmentation, gearing their products to consumer groups based on factors such as nationality, social status, and ethnicity. Leaders operating in the market include Wells Fargo, Pictet, HSBC, UBS, Credit Suisse, and RBC.
Regional Banking Market Share
The global banking industry(which includes both retail banking and investment banking) growth will be driven by cross-border expansion due to the breaking down of obstacles to cross-border investment. Competition between international banks is also forecast to fuel market growth along with the introduction of new products, reduction of costs and launch of new services.