Corporate and investment banks (CIBs) are facing intensifying competition from non-bank financial institutions, as rising client expectations and underperforming technology investments reshape the industry landscape.
According to the Capgemini Research Institute’s inaugural World Corporate and Investment Banking Report 2026, 85 percent of corporate clients plan to engage with non-bank financial institutions within the next 12 months, seeking faster, more transparent, and responsive services.
The findings highlight a widening gap between what clients expect and what banks currently deliver. While 58 percent of clients demand real-time responsiveness, 49 percent expect personalised engagement, and 40 percent seek innovative solutions, only 23 percent believe CIBs are meeting these needs.
Instead, clients point to persistent inefficiencies. About 92 percent cite limited integration with enterprise resource planning (ERP) and treasury systems, forcing manual workarounds. Meanwhile, 89 percent report a lack of flexibility and personalisation, while 68 percent say banks fall short in advanced analytics and forecasting capabilities.
The report also reveals growing frustration within the banking sector itself. Around 82 percent of CIB executives say innovation programmes are failing to generate new revenue streams, while more than half report that expected cost savings have not materialised.
Structural constraints are compounding the problem. Banks allocate just 29 percent of their IT budgets to transformative technologies, while 43 percent is consumed by maintaining legacy systems. In addition, 61 percent of executives cite high compliance costs as a major barrier to innovation and agility.
These challenges come at a time when revenue growth is slowing. Capgemini forecasts a compound annual growth rate (CAGR) of 5.4 percent for the sector over the next five years, down from 6.5 percent recorded between 2022 and 2024.
Despite these headwinds, banks are pushing to remain competitive by expanding their product offerings. More than three-quarters (77 percent) of CIB executives are prioritising real-time treasury solutions to support cross-border payment flows. Meanwhile, 65 percent are investing in next-generation artificial intelligence (AI) tools for algorithmic trading, including AI-driven hedging and market intelligence.
In addition, 51 percent are exploring tokenised products, aiming to unlock new revenue streams through digital custody services, token issuance, and premium financial offerings.
“Non-banks are rapidly closing the competitive gap with established corporate and investment banks,” said Catherine Chedru-Refeuil, Global Head of Corporate and Investment Banking at Capgemini. “Client demands have shifted dramatically, and while banks have invested heavily in AI, many are struggling to move beyond pilot stages.”
She noted that governance remains a key obstacle, with only 26 percent of banks operating under centralised AI oversight. This lack of structure often discourages teams from automating critical processes.
“To succeed, banks must adopt a disciplined approach—building enterprise-grade platforms and developing ecosystems of trusted partners,” she added. “Early adopters will benefit from stronger client engagement, improved fee income, and significantly lower costs.”
The report underscores that technological upgrades alone will not be sufficient. Banks must also address cultural and organisational barriers that slow transformation.
Around 39 percent of executives say conservative corporate cultures hinder experimentation with new technologies. At the same time, talent gaps persist, with 40 percent of banks seeking external hires to strengthen AI capabilities, while only 23 percent are investing in reskilling existing staff.
Trust also remains a critical issue. Nearly 89 percent of clients express concerns about the reliability of AI-generated outputs, highlighting the need for greater transparency as banks expand their use of emerging technologies.
The report draws on insights from 600 senior executives across large corporations and non-bank financial institutions, each with annual revenues exceeding $1 billion.
As competition intensifies, the message is clear: unless corporate and investment banks can modernise their systems, rethink their operating models, and rebuild client trust, they risk ceding further ground to more agile, technology-driven rivals.
No comments :
Post a Comment