The Year Ahead: Next Generation Banking
December 14, 2020
The ongoing Covid-19 pandemic has upended business models around the world. The banking industry is no exception. While banks had already begun their march toward a digital future, this transformation has now taken on an even greater urgency. How will this wave of disruption play out in the next decade? Where will we be in 2030?
This briefing focused on how this sector is prioritizing investments and adapting operations, managing costs and adopting new technology to navigate challenges and further build out dynamic organizations.
Click here to view the video of the full discussion.
Michael Demissie, Head of Advanced Solutions – AI, Blockchain and Digital Assets, BNY Mellon
Sarah Diamond, Global Managing Director – Financial Services Sector, IBM
Adam Evans, Chief Information Security Officer, RBC
Andrew Lang, Chief Technology Officer, JP Morgan Chase & Co.
Gary McAlum, Chief Security Officer & Senior Vice President, Enterprise Security, USAA
Sanjay D Naik, Chief General Manager & Head of International Banking, State Bank of India
Judith Pinto, Managing Director, Promontory, an IBM company
Ravi Radhakrishnan, CIO, Commercial Banking and Corporate & Investment Banking, Wells Fargo
Katherine Wetmur, Head of Technology & Operations Risk, Morgan Stanley
Shadman Zafar, Head of Global Consumer Banking Technology, Citi
Caroline Hyde, Anchor, Bloomberg Television (host)
Julie Santoriello Chariell, Senior Analyst Fintech & Payments, Bloomberg Intelligence
Kartikay Mehrotra, Cybersecurity Reporter, Bloomberg News
Lananh Nguyen, Finance Reporter, Bloomberg News
Fireside Chat: A Case Study in Digital Transformation
Sanjay D Naik, Chief General Manager & Head of International Banking, State Bank of India, sat down with Caroline Hyde, a Bloomberg Television anchor, to discuss the tremendous movement his bank has made in the implementation of new technology.
The role of machine learning
Naik shared, “We use machine learning in a big way, and we have what is called a business analytics department, which creates or which develops a number of models. These models are based upon the customer behavior. The nature of transactions and those models help us in certain ways, they help us in predicting the transactions in that account that may happen. So we use machine learning in a big way and, more importantly, in business development.”
Accessing innovation through partnerships
Naik stated, “It’s a young country and there are a good number of talented engineers. So not only do we have engineers on our books but we also partner with not only Indian but other foreign companies, some American companies. So we partnered on developing our IT infrastructure and developing various models and various technological platforms. We look outside India also to get that kind of assistance, that kind of a partnership.”
Re-Shaping the Future with Advanced Technologies
Michael Demissie, Head of Advanced Solutions – AI, Blockchain and Digital Assets, BNY Mellon and Ravi Radhakrishnan, CIO, Commercial Banking and Corporate & Investment Banking, Wells Fargo sat down with Lananh Nguyen, Finance Reporter, Bloomberg News, to discuss how they are using advanced technologies to streamline operations and improve risk management.
An example of the acceleration of digitization
Radhakrishnan discussed onboarding small businesses for the lending stimulus Payroll Protection Program, “We used a number of different digitization technologies. So we use e-signature for capturing the signatures on the forms itself. We use robotic process automation after applying some optical character recognition to the application. So there were a bunch of forms that the small business lending customer clients had to give up. And rather than process them manually, we applied this combination of both a digital customer interface, but also digitization behind it to be able to process those volumes in a very compressed timeframe. So we ended up doing what we might do in a couple of years in a matter of a couple of weeks.”
Using predictive analytics for risk management
Demissie stated, “And other areas that we see these types of technologies actually having significant impact is improving the risk, you know risk controls that, that would be difficult to do otherwise. So think of detection. You’re talking about thousands and thousands if not millions of transactions and being able to sift through that and, you know, identify something that is anomalous. So that it can be examined better is really an exciting application in a class as well. So really it’s a very far-reaching from the, you know, the simple automation to insights to risk management as well.”
Banking transformed – moving to the Cloud
Andrew Lang, Chief Technology Officer, JP Morgan Chase & Co., Judith Pinto, Managing Director, Promontory Financial Group, an IBM Company, and Shadman Zafar, Head of Global Consumer Banking Technology, Citi, engaged in a discussion led by Julie Chariell, Senior Analyst Fintech & Payments, Bloomberg Intelligence.
Reasons for moving to the Cloud
Pinto summarized “I think a big driver is the large amount of data that organizations accumulate now. You know it’s hard to do that sort of on premises. It’s very expensive from a technology perspective. So being able to take advantage of Cloud technologies to help manage that data through data analytics, it’s you know, it’s hard to replicate that in an internal environment.”
Ensuring the security of the Cloud
Lang stated, “So we’ve been on our journey for several years and we’ve made significant progress on both public and private cloud and implementation. Our approach has been to build security in at the start. So we take a blueprint approach, so it’s a very prescriptive structure. We go through our cloud design council or our security review council, etcetera. And in those, those blueprints are hardened with the security controls built in and all the monitoring and so forth”.
The intangible benefits of moving to the Cloud
Zafar stated, “I would say that the somewhat intangible but very powerful benefit has really been energizing the talent to learn new technology. People sort of joining in as we are sort of utilizing new technology has been an energizing force in the organization. But sort of moving beyond that I think there are few times, frankly, in people’s careers you get an opportunity to actually refactor from ground up and rethink the application in a way that you can have correct by design and secure by design principles incorporated into your applications.”
How safe is my data?
Adam Evans, Chief Information Security Officer, RBC, Gary McAlum, Chief Security Officer & Senior Vice President, Enterprise Security, USAA, and Katherine Wetmur, Head of Technology & Operations Risk, Morgan Stanley shared their experiences with Kartikay Mehrotra, Cybersecurity Reporter, Bloomberg News
Diligence is the best protection
Evans stated, “You need to move out on, you know into a proactive security posture which means employing things like hunting, red teaming and testing your defenses and making sure that the policies that you put out, the controls that you operate, are operating effectively.”
Automation is key
McAlum stated, “So we’re all getting saturated with data and information from multiple sources all the time. At least from our perspective, it’s really key to have automation. And I would say a relatively sophisticated level of automation that helps ingest all of this information and parse through it.
Protecting consumer data is a shared responsibility
As Wetmur stated, “So you’re only as good as your weakest link. And so if your weakest link is something you might be doing on your own mobile device, if your weakest link is someplace that you’re giving your data, your weakest link is you clicking on a phishing exercise. Those are the problems I think that are out there. And that’s the thing that we can’t protect everybody from. And people need to take that ownership themselves over understanding their weakest link, and understanding where their data is at and being able to manage that seriously.”
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