Banks to go soul searching for new ways of banking

WHEN Aretha Franklin belts out "chain, chain, chain, chain of fools" in her classic song Chain of Fools, some listeners heard it as "change change change, change is good". With the new year just around the corner, it seems timely to indulge in this unintended optimism and ask what lies ahead for the banking industry.

A question mark hangs over the way in which business models in banking would shift to account for the ongoing digital disruption. McKinsey's 2017 banking report has dour predictions of return on equity (ROE) in the banking industry hitting 5.2 per cent by 2025, if banks sit on their hands.

Three paths