Banking - Worldwide

Worldwide

In 2024, it is projected that the Net Interest Income in the Banking market worldwide will reach a staggering amount of US$8.52tn.
The market is predominantly dominated by Traditional Banks, which are expected to have a projected market volume of US$7.03tn in the same year.
Moving forward, the Net Interest Income is anticipated to display an annual growth rate (CAGR 2024-2029) of 4.92%.
This will result in a significant increase, leading to a market volume of US$10.83tn by the year 2029.
When considering a global perspective, it is noteworthy that China will generate the highest Net Interest Income.
In 2024, China is expected to generate a substantial amount of US$4,332.0bn.
Despite global economic challenges, the banking sector in countries worldwide continues to innovate and adapt to digital transformation to meet the evolving needs of customers.

Key regions: United States, China, Japan, Brazil, United Kingdom

Definition:

The Banking market refers to the financial services sector providing financial products and services to individuals and businesses. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.

Structure:

The market consists of two segments:
- The Traditional Banking market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels.
- The Digital Banking market refers to the emerging market for digital-only banks that offer financial services through online and mobile platforms.

The market data comprises Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the Retail & Commercial banking market, creating opportunities for new entrants, and forcing existing players to adapt.
Key players in this market are companies such as the Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

The Banking market is a dynamic industry that is continuously evolving to meet the changing needs and preferences of customers worldwide.

Customer preferences: Customers in the Banking market worldwide are increasingly seeking convenience and efficiency in their banking services. This has led to a rise in digital banking solutions, with more customers opting for online and mobile banking options. Additionally, customers are placing a greater emphasis on personalized services and are looking for banks that can offer tailored financial solutions to meet their individual needs.

Trends in the market: In North America, the Banking market is seeing a trend towards consolidation, with larger banks acquiring smaller regional banks to expand their market presence. This trend is driven by the desire to achieve economies of scale and enhance competitiveness in the market. In Europe, there is a growing focus on sustainable banking practices, with customers showing a preference for banks that prioritize environmental and social responsibility. This has led to the development of green banking products and services across the region.

Local special circumstances: In Asia, the Banking market is characterized by a high level of competition and innovation. Fintech companies are disrupting the traditional banking sector by offering innovative solutions such as peer-to-peer lending and digital wallets. As a result, banks in Asia are increasingly partnering with fintech firms to stay competitive and meet the evolving needs of customers. In Africa, the Banking market faces unique challenges such as limited access to banking services in rural areas. To address this, banks are expanding their branch networks and investing in mobile banking solutions to reach unbanked populations.

Underlying macroeconomic factors: Global economic factors such as interest rates, inflation, and GDP growth play a significant role in shaping the Banking market worldwide. Low interest rates can impact banks' profitability, while high inflation rates can erode the value of deposits. Economic growth can lead to increased demand for banking services, while economic downturns can result in higher loan defaults and credit risk. As such, banks must closely monitor macroeconomic indicators and adjust their strategies accordingly to navigate changing market conditions.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.