AI

Alfa follows a good internet media strategy | Russia

Colin Henderson

Daniel notes good practices in managmenent of a merger using web media. Alfa follows a good internet media strategy – covering its merger with Kazna | Retail Banking in Russia An absolute majority of posts at this blog deals with operational aspects of banks business – but recent coverage of Alfa-Bank and Severnaya Kazna merger gives good examples on how a Web-media strategy of a bank can be formulated to better suit the wavering clients of the banks, and convey a positive image of banks in merger. Continue reading Alfa follows a good internet media strategy | Russia

AI2 Comments

BofA to Eliminate Wire Transfers from Branches, Moving Volume to Online Banking | netbanker

Colin Henderson

By co-incidence here is yet another chink in the armour of the branch network. Long ago Jim had the foresight to write what others could not admit to at that time, with the 40 year view of The Demise of Branches. Iin that far-sighted piece Jim aimed at the core raison d’etre amongst traditionalists, account acquisition, and developed potential approaches to offer a better value proposition than ‘just being there’. In 2006, Banks were in major branch build out mode, to support their market share objectives. The payback period on those branches is extended to say the least. On the … Continue reading BofA to Eliminate Wire Transfers from Branches, Moving Volume to Online Banking | netbanker

Innovation, Profitability

The Productivity Gap is closing in on Banks’ | Branches will be next

Colin Henderson

FT reports on a new Bain report concerning RoE at Banks, and the unliklihood that Banks’ can regain previous RoE levels. This fits with the theme here of no more business as usual, post crisis. The spreads in this low interest enviroment are simply not high enough to accomodate spreads like we saw over the late 90’s and early 2000’s. Furthermore and separate from the spread issue, the growth in credit will not be there either because consumers are unwinding unwieldly debt levels that are now disproportionate to asset levels. The course banks must follow is rejuvenated product suites, and … Continue reading The Productivity Gap is closing in on Banks’ | Branches will be next

US

Abandoned Schools in Detroit | no sign of recovery here

Colin Henderson

I have mentioned more than a few times my belief that recovery is not a return to 2007. The new normal will create damatic shifts and new paradigms for bank planning. Detroit gets picked on a lot …. but these pictures are not pictures of a temoorary set-back. Prepare to be disturbed. This might go some way to explain why houses in Detroit can be purchased for as little as $5K. Abandoned Schools in Detroit Researched by Nobuyo Henderson Continue reading Abandoned Schools in Detroit | no sign of recovery here

Economy1 Comment

Financial markets did not detect the deterioration of structural productivity trends in the early 2000s early enough

Colin Henderson

A fascinating analysis of economic conditions prior to 2007, sugesting that dropping productivity and the concurrent increase in asset prices contributed at least in part to the economic crisis, yet was not picked up by the market. Productivity and the crisis: Revisiting the fundamentals | Vox Most narratives of the crisis start with problems in the financial sector that then spilled over into the real economy. This column looks at the real side first and shows that labour productivity growth declined significantly in the years prior to the crisis, particularly in the US construction sector. Financial markets may have failed … Continue reading Financial markets did not detect the deterioration of structural productivity trends in the early 2000s early enough

Uncategorized2 Comments

Social sites losing popularity with young | FT

Colin Henderson

As people discuss and debate the business model for social networks, the underlying usage remains volatile at best, suggesting that the determination of the model is a long way off. Social sites losing popularity with young | FT “If this trend is true, it would raise questions about the valuation of social networks. It would confirm that on the internet you have to be very agile. One year it is all about search- engine advertising, the next it is about social networking, and something else after that,” said Adam Daum, analyst at Gartner, the IT research group. Mr Daum suggested … Continue reading Social sites losing popularity with young | FT

Security

Indian Banks Adopt a Rule all Banks Need | security alterts

Colin Henderson

India adopts a new rule for Banks [ht Payments news] that should have been voluntarily adopted years ago by all banks everywhere. I have always been a proponent for online alerts, but it makes eminent sense to make "card not present" alerts mandatory. India’s Mandate re: Stronger Authentication for Card Not Present Use | Payments News The rules require India’s banks to support two basic capabilities: A system of providing for additional authentication/validation based on information not visible on the cards for all on-line card not present transactions (e.g., Verified by Visa or MasterCard SecureCode) A system that provides "Online … Continue reading Indian Banks Adopt a Rule all Banks Need | security alterts

Profitability4 Comments

The Dangers of Thin Value

Colin Henderson

Umaiar defines thin value as a mirage that will eventually evaporate. it is value that has no point nor reason, other than generate revenue for the corporation. The landmark example he offers is ARPU, or Average Rrevenue per Customer in the telco business. The 15 second instructional wait time in front of every voice mail is worth $620 million to one telco is one example he offers. The sole purpose of the 15 seconds is to generate revenue, notwithstanding claims that it is for the benefit of the user. The Value Every Business Needs to Create Now| Harvard: Umair Haque … Continue reading The Dangers of Thin Value

Uncategorized

The lesssons of the credit crisis are not being taken seriously by markets

Colin Henderson

I have been following the matter of bank leverage, and the improvements that are required to deal with current bad debts and more importantly future bad debts that will arise from credit card and mortgage defaults. Sadly no lessons have been learnet judging by the reaction from the investment analyst community to the small improvement in capital ratio at Goldman Sachs. Banks still need bigger cushions | Reuters – Rolfe Winkler It was a surreal moment two weeks ago when analysts on Goldman Sachs’ earnings conference call pressed CFO David Viniar to jack up leverage. They seem to think that … Continue reading The lesssons of the credit crisis are not being taken seriously by markets