2025年资本市场愿景（英）-81页_4mb

Summary of Capital Markets Vision 2025

Core Content

The Capital Markets Vision 2025 report outlines the future direction of the global capital markets industry, focusing on the sell-side, buy-side, and financial market infrastructure sectors. It highlights the need for digital transformation, strategic realignment, and operational efficiency to prepare for the evolving landscape of 2025 and beyond.

Main Points

1. Industry Overview

• The global capital markets industry experienced limited revenue growth before 2020, with economic returns varying widely.
• The pandemic led to a rebound in revenues, especially for sell-side and exchanges, while the buy-side saw increased assets under management and strong investor interest.
• The report emphasizes that this rebound is a golden opportunity to invest in new technologies and ways of working to prepare for future disruption and long-term success.

2. Digital Value Realization

• Technology-led innovation and new digital value chains are the primary drivers of industry disruption.
• The rate of technological change is accelerating, with disintermediation becoming a key challenge for investment banks.
• The buy-side is expected to evolve into digitally native firms, integrating technology into investment processes, client interactions, and organizational culture.

3. Revenue and Profitability Trends

• In 2020, the capital markets industry generated $1.12 trillion in revenue and $119 billion in economic profit.
• The buy-side accounted for 65% of industry revenues and 90% of economic profit, while the sell-side and market infrastructure shared 35% of revenue but only 10% of profit.
• Investment banking and exchanges showed some improvement in efficiency, but asset management and asset servicing saw rising cost-income ratios, indicating unsustainable trends.

4. US Banks' Structural Advantages

• US-based investment banks have a structural edge over European peers, due to:
  • A larger and deeper capital market.
  • Faster regulatory responses and recapitalization post-crisis.
  • Stronger underlying economy and absence of sovereign debt crisis.
  • Higher returns from non-capital markets activities, such as retail and commercial banking.
• Technology investments have also contributed to the stronger performance of US banks, though they were enabled by better underlying economics.

5. Investment Banking Vision for 2025

• The fundamental role of investment banks as intermediaries will remain, but their business models must evolve.
• The intermediary role is increasingly disintermediated by technology, especially in secondary trading and tokenization.
• The value of the industry will shift from capital to capability, with people and technology becoming the key assets.

6. Action Agenda for Investment Banking

• Short Term: Bending the Cost Curve

  • Rebuilding around the core: Reduce front-office processing costs, reshape support functions using cognitive automation, compliance innovation, liquid workforce models, end-to-end platforms, and asset tokenization.
  • New technology landscape: Embrace cloud architecture, analytics, AI, ML, SaaS, and DevOps to improve scalability and flexibility.
  • Future of work: Leverage technology to improve productivity, employee mental health, and real estate efficiency.

• Medium Term: Setting the Focus and Enhancing the Client Experience

  • Redesign operating and technological models: Focus on value-adding competitive advantages, product and geography specialization, and digital offerings that transcend traditional counterparty relationships.
  • Enhance client experience: Use automation, interconnected data, and intelligent processing to create seamless client journeys.
  • Leverage AI and machine learning: Improve sales and revenue through tailored client interactions and next best action insights.

7. Talent as a Critical Success Factor

• Talent strategy is a prerequisite for success in 2025.
• Competition for top talent is intensifying, especially with global tech giants.
• Investment banks must upskill their workforce in data fluency, handling, and analysis to harness data and drive value.
• A digitally-enabled operating model is necessary to keep costs low and enhance experiences for employees and clients.

Key Information

• 2020 Revenue Growth: Investment banking revenues rose by ~$45 billion compared to 2019.
• Cost-Income Ratios: The average cost-income ratio for capital markets firms in 2020 was 66.7%, nearly the same as in 2017.
• Economic Profit: The top 16 investment banks generated ~$285 billion in revenue in 2020, but RoE for the top nine global banks has consistently failed to beat 10% cost of equity capital.
• US Banks' Advantage: The US investment banks have higher returns from non-capital markets activities, better regulatory environment, and more proactive central bank actions.
• Future of Work: The workforce must adapt to digital transformation, with technology investments and mental health support being essential.
• Client-Centric Approach: The buy-side and wealth management will shift toward client-driven and digitally integrated models.
• Tokenization and Automation: These will reduce costs, increase efficiency, and change the role of intermediaries in capital markets.

Conclusion

The Capital Markets Vision 2025 underscores the urgent need for transformation, especially in investment banking, asset management, and market infrastructure. With digital technologies and strategic focus, the industry can redefine value creation, improve efficiency, and adapt to future challenges. The key to success lies in embracing technology, rethinking business models, and investing in talent and agility to stay competitive and drive long-term profitability.