The One Key Question About Retail Banking’s Future

by Snarketing 2.0

By Ron Shevlin

In connection with its Retail Banking conference, American Banker ran an article titled Five Key Questions about Retail Banking’s Future which included the following questions:

1. How many branches should we close?
2. How many new branches should we build?
3. How many more people should we lay off?
4. How much revenue can we get from offering mobile and online technology?
5. What are the future sources of revenue?

My take: An OK list. But not in the right order. And if you put them in the right order, there’s really only one key question about retail banking’s future, because the answers to the others are all dependent on the answer to the one key question.

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So what’s the one key question? Simply: What are the future sources of revenue?

A bank can’t determine how many branches it should open/close, or how many people to let go, until it has a clear vision and strategy for how it’s going to generate revenue. Specifically, what (products and services), where (geographically), and from whom (customer segments).

Closing/opening branches and/or letting people go before developing that vision/strategy is pure stupidity, and the board should fire any CEO that does the former before the latter.

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