Global Banking Outlook 2023: Navigating Volatility and Reinventing Growth

Global Banking Monitor's flagship 2023 report provides a comprehensive assessment of global banking conditions, examining the interplay of inflation, interest rate shifts, and geopolitical pressures that defined the year - and outlining the strategic priorities banks must pursue to achieve sustainable growth.

Drawing on macroeconomic analysis, regional performance data, and institutional case studies, the 84-page report offers a structured view of where the global banking industry stands and where it is heading.

Key findings

• Interest rate normalisation is a double-edged sword. While net interest margins have expanded significantly, deposit pricing pressure and shifting lending dynamics mean the profitability boost is unevenly distributed and unlikely to persist at current levels.
• Regional performance is diverging sharply. European banks face margin recovery challenges, US institutions benefit from scale advantages, and Asian markets are balancing growth ambitions against tightening regulation.
• Cost pressures are intensifying. Inflation-driven operating cost increases, combined with the growing burden of technology investment, are forcing banks into difficult trade-offs between efficiency and transformation.
• Credit risk is building quietly. While headline metrics remain manageable, underlying trends in consumer and commercial lending suggest banks need to prepare for deterioration in 2024.
• Strategic responses cluster around three themes: portfolio rebalancing, digital acceleration, and cost transformation - but execution quality varies dramatically across institutions.

What the report covers

The report is structured across 10 chapters spanning the full macro-to-strategy landscape:

1. Executive Summary - Global outlook, key risks and opportunities, and strategic imperatives
2. Macro Environment Overview - Inflation and interest rate dynamics, geopolitical pressures, and economic growth outlook
3. Interest Rates and Profitability - Net interest margin expansion, deposit pricing pressure, and lending dynamics
4. Regional Performance - Europe, US, Asia, and emerging markets compared
5. Revenue Outlook - Lending growth, fee income pressure, and new revenue streams
6. Cost Pressures - Inflation-driven increases, technology investment burden, and efficiency programmes
7. Risk Landscape - Credit risk trends, liquidity risks, and market volatility
8. Strategic Responses - Portfolio rebalancing, digital acceleration, and cost transformation
9. Scenario Analysis - Base case, downside recession, and upside recovery scenarios
10. Outlook 2024-2025 - Medium-term projections and structural shifts in banking

Who should read this

This report is designed for CEOs, CFOs, Chief Strategy Officers, and board members seeking a structured, data-driven view of the global banking landscape. It is equally relevant for investors, analysts, and consultants advising financial institutions on strategic direction.

For enquiries about accessing this report, contact [email protected]