I have been leading our firm's involvement in the CBI/PwC Financial Services Survey for several years now.
It has been very interesting to see the ebb and flow of the financial services sector during this period.
I have observed the doom and gloom of the financial crisis, the spike of optimism shortly after, the reality check when everyone realised that things were not going to return to the way they were and the dawning realisation of the likely new regulatory regime and its impacts on capital, liquidity, structures and pay.
We are, in my view, about to enter into a new era and the survey results provide a strong indication of this. The age of technological revolution, disruption and threats are now truly upon us as a sector.
The structural issues for the financial services industry are well known; poor returns, hardening stress tests driving increased capital and liquidity requirements, aggressive competition from new companies or disaggregation from tech companies and a general talent drain.
The road to salvation for the established players lies in harnessing the fintech revolution that is taking place around them. Those that are successful will enhance the customer experience and protect or increase revenues as a result.
They will look to re-engineer outdated and old systems and processes to reduce cost, use data in a far better way to demonstrate risks more accurately with associated capital and liquidity impacts.
They will also aim to get machines to do what it currently takes an army of employees to do.
Our survey shows the first real steps towards this are being taken by the major players.
Previously, we had seen increasing concerns about the rise of new competition but many in the sector were focused on delivering against their mandatory regulatory obligations. From the survey and my discussions with chief executives of many institutions it is clear that the agenda for regulation is now pretty well set.
The sector is now turning towards the ways to transform itself using technology and we see this from several indicators in the survey.
Can the sector transform successfully? Some argue they cannot. However, it is easy to forget how the sector adopted voice (call centres) and then the internet.
The difference this time is that the speed of adoption is much faster and the ability of new entrants to seize a strong market position much enhanced.
My conclusion is that some will manage but there will be a couple that fail and will linger in the banking twilight as banking utilities.
It would, however, be remiss of me not to mention the spectre of cyber as this risk to technology sits across the sector as well.
Where this will impact is hard to know - it is as much a threat to new entrants as to existing. Much investment is needed to combat this, as is also recognised in the survey.