As the year comes to an end, we thought we’d take the opportunity to reflect on the hot topics that have affected the Banking sector in 2021, and to look at the key themes that will shape our industry in 2022 and beyond.
We hope you enjoy the read, and we wish you a very safe and happy holidays from everyone here at PEN.
A brief look back at 2021…
We made some fairly bold predictions last year, so we thought we’d check in and see how we got on…
What we got right…
Organisations across the sector returned to the office to some degree, albeit it was mostly after July when lockdowns were lifted across the UK, with most large businesses converging on moderate change - nothing too radical, but recognising that the business landscape is evolving. Stubbornly high CIRs meant the focus remained on managing cost, while investment spend revolved around legal, regulatory, mandatory, digital and data. Fintechs have become more established in the market, with greater collaboration with the incumbents, but they are yet to take significant market share. And ESG is becoming more prevalent around senior management tables, but we haven’t seen its impact on day-to-day working life just yet.
What we nearly got right…
The economic outlook has largely been driven by external factors caused by the pandemic, Brexit, and the economic overhang from 2020 (which we predicted would result in slow growth). However, recent results have shown a return to significant profits in the sector. We also expected organisations to embed more cultural and operational learnings from the pandemic. This has been done to some degree, but we’re yet to see these fully embedded into organisations’ ways of working.
What we got wrong…
Two of our predictions didn’t come to fruition. We expected to see FCA investigations into poor customer outcomes from decisions made in 2020 (i.e. mortgage payment holidays), while our reading of the tea leaves on M&A activity were overstated - there have been hints at possible M&As, but not at the level we predicted.
What do we predict for 2022?
With relative success in 2021, here are our predictions for 2022…
