14


NEWS Wells Fargo to close 900 branches W


ells Fargo is planning to close about 900 branches in a new cost-cutting initiative, despite its boosted profits of $3.4 billion. The San Francisco-based


group, which operates about 5860 branches across the country, said it would make the closures by the end of 2020, according to the Financial Times.


The bank has recently taken a $3.25 billion pre-tax hit to earnings, mainly from litigation accruals for mortgage-related regulatory investigations and sales practices.


On a conference call with analysts, Wells Fargo pinpointed a shift in preferences to online and mobile banking as a major factor behind the plans.


“We will have as many branches as our customers want for as long as they want them,” said John Shrewsberry, the group’s chief financial officer.


Wells Fargo aims to cut $2 billion in expenses this year, as well as another $2 billion in 2019.


Monzo to shut down prepaid cards as it commits to current accounts


W


ith the ambitious goal of building “the best current account in the world”, Monzo has confirmed in one of its blogs that it will soon shut down its prepaid


card service, encouraging users to switch to current accounts as soon as possible. The deadline for this change is “early April”.


The idea behind the current accounts is that they work exactly the same, according to Monzo – but not really. The challenger bank has been struggling to maintain its top-up feature in current accounts due to running costs, despite the popular demand.


“It’s also much cheaper (and more reliable) for us to run our own systems and means you get a bunch of new features, like a


sort code and account number, pots, bank transfers and more!” claimed the blog.


So far, despite having more than half a million customers, not even half have made the upgrade. These people will receive a warning at least 60 days before it actually shuts.


The change to a current account is free and customers become backed by Monzo’s banking licence (and £85,000 FSCS protection), including a sort code and account number.


Monzo ends the blog with its all-loving, community-building mumbo-jumbo spiel [Ed: in this reporter’s opinion].


Legacy systems, lack of knowledge and resources holding back fintech


L


egacy systems are holding back 61% of commercial banks from developing fintech applications, according to research commissioned by Fraedom. The survey, which polled


decision-makers at commercial banks, discovered that a lack of relevant expertise (56%) and access to resources (53%) were significant factors affecting innovation.


“The research highlights that legacy systems are the most common barrier preventing commercial banks from developing fintech applications,” said Kyle Ferguson, CEO at Fraedom. “Trusted fintech firms offer banks the chance to overcome these in-house challenges and reap the benefits from technical applications that can lead to more revenue-making opportunities.”


Interestingly, senior staff members in banks consider fintech a threat, with 18% of shareholders believing that they pose a risk to the entire banking industry, a view that was held by just 8% of middle managers. Despite this, only 26% of commercial banks do not outsource any services to fintechs. In the UK alone, nearly half (46%) of domestic respondents said their bank outsources payment solutions to fintech providers.


“The commercial banking sector must become more efficient at adopting new technologies. Fintech firms can make a big difference to certain areas, such as commercial cards,” added Ferguson. “Established fintech providers are rich with technical expertise and have the in-depth knowledge of local markets to successfully partner with banks.”


www.ibsintelligence.com | © IBS Intelligence 2018


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52