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Irish Examiner
27-06-2025
- Business
- Irish Examiner
Ireland's firms brace for economic hit with quiet confidence
Hundreds of companies, 200,000 jobs, billions of euro in corporation tax revenue. Add it all up and Ireland's reliance on US investment for its economic success is starkly clear. While it is one of the most vulnerable countries to Donald Trump's efforts to rewrite global trade, there's a quiet confidence in its financial sector and economy. From the finance minister to bankers, the view is that the small, open economy, with its low unemployment and a healthy budget surplus starts from a strong point against any potential shocks. They believe the country can leverage its reputation for stability, clear regulation and business friendliness to ensure Ireland stays an attractive location for money. It's a model that has long worked for the country, but it will face tests in the coming years. Acknowledging that, the central bank, Department of Finance, and major banks have cut their economic forecasts in recent months. 'We focus on what we can control,' finance minister Paschal Donohoe said this week. From an Irish point of view, we can't influence what's going to happen with global trade, but we can influence how competitive our economy is. Based on a domestic measure, growth is set to slow to about 2% in 2025, from 2.7% last year. Much of the concern for Ireland centers on what tariffs mean for its tech and pharmaceutical sectors, which is dominated by firms like Apple, Alphabet, Eli Lilly, and Pfizer. Corporation tax receipts, heavily concentrated in a small number of firms, totalled €39bn in 2024, accounting for 36% of the total tax take. That figure encapsulates Ireland's prowess at luring foreign capital, and its dependence on American money. In spite of the risks to investment and jobs, the country's financial elite continues to see expansion. That message was on display this week at the Future of Finance event hosted by Bloomberg in Dublin, where Donohoe spoke. The financial services industry has grown substantially over the past decade, in part because of the stability Ireland has developed since the 2008 financial crash. Measured by assets, the sector reached €8tn in size in 2023. Total assets under management for Irish-resident investment and money market funds is at €5.5tn, more than tripling over the last decade, according to the central bank. Along with competitiveness, Ireland's other sales pitch is consistent and clear regulation. The idea is guardrails and stability, but not unwanted deterrents. Mary-Elizabeth McMunn, deputy governor at Ireland's central bank, calls it a 'pragmatic' approach. 'We want financial institutions to be around in good times and in bad,' Ms McMunn said. So in some ways I would say our interests are completely aligned because if I'm a CEO of an institution, I want to be around for the longer term. I don't want a shock to hit that really adversely interrupts my business. While the central bank has recently won plaudits for its industry engagement, it drew criticism after the Brexit vote when it frustrated banks looking to set up trading arms in Dublin. Most ultimately opted for Frankfurt and Paris. There are also lingering frustrations about high taxes on some activities and what is effectively a cap on bank bonuses. AIB share sale Emblematic of Ireland's financial turnaround, this month the Government disposed of the remainder of its shareholding in AIB. After the bailouts of the global financial crisis, that means the country's two biggest banks are now fully out of State ownership. A third, PTSB, will follow at some point. The bailouts cost billions of euros — AIB alone came to about €20bn — but the Government said it broke even based on current market prices. AIB's journey reflects the broader changes that have taken place. 'The industry is fundamentally different than it was,' chief executive Colin Hunt said. When he took over, six and a half years ago, 'nonperforming exposures were 10% of gross loans. They are now less than 3%, and that is reflected right across the industry,' he said. While the Irish banking industry is now more streamlined, Mr Hunt said AIB could take part in wider European consolidation in the future, though he does not see anything imminent. 'You want to ensure that your institution is in a relatively strong position to decide how it plays in that consolidation wave,' he said. For Ireland, the general optimism will undoubtedly be challenged. There are less than two weeks to go before Trump's July 9 deadline for a trade deal, after which tariffs on almost all EU exports to the US will jump to 50%. 'There are challenges,' Mr Donohoe said. 'But we are well-placed to deal with them. And we will.' Bloomberg Read More Trump's policies blamed as Irish tourism revenues drop
Time of India
05-06-2025
- Business
- Time of India
From trading floors to retail loans, traditional banks lose ground to tech-savvy challengers: BCG
Traditional banks are struggling to keep pace with fast-moving, tech-driven financial rivals, even as the overall financial services sector continues to grow. This is the central finding of Boston Consulting Group's latest Future of Finance report. 'Financial services revenues are growing – but banks are not capturing their fair share,' BCG says. The report observes that value is shifting away from traditional banks to fintechs, private credit funds, non-bank liquidity providers, and digital-native banks. 'Maturing digital assets appear to be on pace to cause significant disruption, with most banks currently on the outside looking in,' it adds. Digital attacker banks have seen the highest growth among financial players. According to BCG, these banks have recorded revenue compound annual growth rates (CAGR) of 85–100% over the past five years. They are followed closely by private credit players and retail trading platforms. In contrast, traditional banks have posted revenue CAGR of just 10–15%, even though they still hold the largest share of balance-sheet assets. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Esse novo alarme com câmera é quase gratuito em Guarujá (consulte o preço) Alarmes Undo The advantage of these challenger firms lies in their use of scalable platforms, lean cost structures, and digital-first models. 'Non-traditional bank competitors are generating new revenue pools,' BCG says. 'The best attackers are positioned for rapid growth, thanks to modern technology stacks and front-to-back digitised operating models.' The disruption is not limited to retail finance . In capital markets too, boutique advisory firms and non-bank market makers are steadily eating into the fee income of large banks. 'Private credit has been gnawing away at bank share, particularly in the US,' the report says. Live Events Traditional banks are also facing deep-rooted structural challenges. Their fee income is declining. Productivity from non-interest income has dropped across all regions. Meanwhile, cost pressures continue to rise. Despite having invested in technology for years, their efficiency gains are starting to slow. 'Many banks struggle to counter these trends,' BCG says. The report also points out that pricing remains an underused tool for improving performance. The difference in cost efficiency is stark. According to the report, the cost-to-serve for neobanks is often only one-tenth that of traditional banks. 'New competitors are winning on productivity,' BCG says. Investors, too, are taking note of this growing gap. In regions such as East Asia and the Eurozone, most bank stocks are now trading below their book value. 'Investors are avoiding banks that may be in a vicious cycle of outdated operating model and low profitability,' BCG warns.
Time of India
04-06-2025
- Business
- Time of India
'Traditional banks losing share to fintechs globally'
MUMBAI: Traditional banks are losing ground in the fast-evolving financial services space to agile, tech-driven rivals. Even as overall sector revenues grow, incumbents struggle to hold on to their share, according to Boston Consulting Group's latest Future of Finance report. "Financial services revenues are growing - but banks are not capturing their fair share," BCG says. The value, it notes, is shifting to fintechs, private credit funds, non-bank liquidity providers, and digital-native banks. "Maturing digital assets appear to be on pace to cause significant disruption, with most banks currently on the outside looking in." The fastest-growing players are also the most digitally savvy. Digital attacker banks clocked 85-100% CAGR in revenues over the past five years. Private credit players and retail trading platforms are close behind. Traditional banks, in contrast, posted only 10-15% CAGR, despite holding the largest share of balance-sheet assets. The challengers' edge stems from scalable platforms, lean cost structures, and a digital-first approach. "Non-traditional bank competitors are generating new revenue pools," BCG says. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 임플란트 최대 할인 지원해드려요 임플란터 더 알아보기 Undo "The best attackers are positioned for rapid growth, thanks to modern technology stacks and front-to-back digitised operating models." The disruption extends beyond retail finance. In capital markets, boutique advisory firms and non-bank market makers are chipping away at incumbents' fee income. "Private credit has been gnawing away at bank share, particularly in the US," the report says. At the same time, banks are grappling with long-term structural challenges. Fee income is in decline, non-interest income productivity dropped across geographies, and cost pressures are rising. Despite years of tech investment, efficiency improvements are slowing. "Many banks struggle to counter these trends," BCG says, noting that pricing remains an underused lever. Neobanks' cost-to-serve, the report adds, is often a tenth that of incumbents. "New competitors are winning on productivity." Investors have picked up on this divergence. In East Asia and the Eurozone, most bank stocks trade below book value. "Investors are avoiding banks that may be in a vicious cycle of outdated operating model and low profitability," BCG warns. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
04-06-2025
- Business
- Time of India
Traditional banks lose market share to digital competitors in financial services
Mumbai: Traditional banks are losing ground in the fast-evolving financial services space to agile, tech-driven rivals. Even as overall sector revenues grow, incumbents struggle to hold on to their share, according to Boston Consulting Group's (BCG) latest Future of Finance report. 'Financial services revenues are growing—but banks are not capturing their fair share,' BCG says. The value, it notes, is shifting to fintechs, private credit funds, nonbank liquidity providers, and digital-native banks. 'Maturing digital assets appear to be on pace to cause significant disruption, with most banks currently on the outside looking in.' The fastest-growing players are also the most digitally savvy. Digital attacker banks clocked 85–100% CAGR in revenues over the past five years. Private credit players and retail trading platforms are close behind. Traditional banks, in contrast, posted only 10–15% CAGR, despite holding the largest share of balance-sheet assets. The challengers' edge stems from scalable platforms, lean cost structures, and a digital-first approach. 'Nontraditional bank competitors are generating new revenue pools,' BCG says. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Trending in in 2025: Local network access control [Click Here] Esseps Learn More Undo 'The best attackers are positioned for rapid growth, thanks to modern technology stacks and front-to-back digitised operating models.' The disruption extends beyond retail finance. In capital markets, boutique advisory firms and nonbank market makers are chipping away at incumbents' fee income. 'Private credit has been gnawing away at bank share, particularly in the US,' the report says. At the same time, banks are grappling with long-term structural challenges. Fee income is in decline, noninterest income productivity dropped across geographies, and cost pressures are rising. Despite years of tech investment, efficiency improvements are slowing. 'Many banks struggle to counter these trends,' BCG says, noting that pricing remains an underused lever. Neobanks' cost-to-serve, it adds, is often a tenth that of incumbents'. 'New competitors are winning on productivity.' Investors have picked up on this divergence. In East Asia and the Eurozone, most bank stocks trade below book value. 'Investors are avoiding banks that may be in a vicious cycle of outdated operating model and low profitability,' BCG warns. However, a few outperformers are bucking the trend. These banks follow four strategies: full-scale digitisation, building multiproduct digital relationships with customers, narrowing focus to high-return businesses, and pursuing digital-led M&A. 'Banks that generate a significant portion of their revenue from noninterest income—such as wealth management, payments, and advisory services—tend to be more resilient,' BCG says. 'The overall value shift away from banks might seem relatively small so far, but its trajectory should encourage banks to take bold action to capture their fair share,' BCG cautions. Without decisive reform, banks risk becoming 'commoditised providers of balance sheets and risk management.' Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Hi Dubai
13-05-2025
- Business
- Hi Dubai
Dubai FinTech Summit Opens with Global Focus on Innovation and Financial Transformation
Dubai launched the third edition of the Dubai FinTech Summit today, bringing together over 9,000 participants from 120 countries under the theme 'FinTech for All.' Held at Madinat Jumeirah and organised by the Dubai International Financial Centre (DIFC), the event aims to position the emirate as a global hub for financial innovation. Under the patronage of His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, the two-day summit was inaugurated in the presence of His Highness Sheikh Ahmed bin Saeed Al Maktoum, reinforcing the UAE's growing reputation as a leading FinTech centre. The event draws more than 1,000 investors, 300 speakers, and 200 exhibitors, highlighting Dubai's appeal as a business-friendly, tech-forward environment. Dedicated start-up and country pavilions, along with the FinTech World Cup, provide a global stage for emerging solutions. Strategic discussions are being held on key trends like AI integration, sustainability, and the evolving role of digital finance. DIFC also unveiled its first Future of Finance report, showcasing the transformative impact of AI and FinTech on traditional financial models. The report identifies major opportunities in digital banking, cloud-based infrastructure, and hybrid product development. During his opening remarks, DIFC Governor Essa Kazim announced the Dubai Future Finance Week, scheduled to debut in 2026, which will consolidate major financial events under one global platform. It is expected to attract over 40,000 participants. Dubai's FinTech ecosystem has expanded rapidly, with over 1,300 AI and innovation firms from 63 countries now based in DIFC. Start-ups have raised more than $4 billion globally, strengthening Dubai's position among the top five global FinTech centres. The summit continues tomorrow with more high-level sessions featuring global financial and regulatory leaders. News Source: Dubai Media Office
