2025年资本市场愿景（英）-81正式版.ppt

Towards the Marketsof TomorrowCapital Markets Vision 2025IntroductionSell-SideBuy-SideMarket InfrastructureConclusionIntroduction38Financial Market Infrastructure:Exchanges and Asset Servicing58Sell-Side:Investment BankingExecutive summary5861666871Exchanges today:Fighting for listings to achieve a“domino effect”on revenuesThe exchanges vision for 2025:The fully automated digital exchange of the futureAn action agenda for exchangesExecutive summary811Investment banking today:Seeking to recover from a“lost decade”The investment banking vision for 2025:People and technology as key assetsAn action agenda for investment banking1620Asset servicing today:A strong focus on post-trade servicesThe asset servicing vision for 2025:A digital industryAn action agenda for asset servicing firms7476Buy-Side:Asset&Wealth Managementand Private Markets26Conclusion78Executive summary26323538404447495356Asset management today:The pressure to transformThe asset management vision for 2025:A new playbook in actionAn action agenda for asset managersWealth management today:A story of client-driven transformationThe wealth management vision for 2025:Business models with the client at the centerAn action agenda for wealth managersPrivate markets today:The industrys profit engineThe private markets vision for 2025:Creating the digitally enabled firmAn action agenda for private markets firmsCapital Markets Vision 20252IntroductionSell-SideBuy-SideMarket InfrastructureConclusionIntroductionAn industry facinga rare opportunityThe global capital markets industry sawmostly limited revenue growth in theyears leading up to 2020.1At the same time,firms economic returns variedwidely,with many industry players failing to beata standardized cost of equity capital.Combinedwith persistent structural cost issues,thesecharacteristics all suggested an industry in thelatter phases of its economic cycle.Capital Markets Vision 20253IntroductionSell-SideBuy-SideMarket InfrastructureConclusionA focus on realizing digital valueFrom the heavily skewed capitalmarkets industry of todayBut then COVID-19 came along anddefined the industrys landscape in 2020.And while the pandemic has had a terribleimpact on humanity and many sectors ofthe economy,it has also brought the sell-side and the exchanges an unexpectedrespite with revenues at near-recordlevels.The buy-side saw strong growthin assets under management and highinvestor interest.Overall,capital marketsindustry revenues were stable in lightof unprecedented economic times andshort-term profitability was strong formany firms in 2020.In our Capital Markets Vision 2022 reportpublished three years ago,we identified theprimary drivers of industry disruption in capitalmarkets as being technology-led innovationand the creation of new digital value chainsacross the industry.2 Today these trends remainfundamentally consistent.So,what has changed?In 2020,the capital markets industryas a whole generated some$1.12 trillionin revenues and around$119 billion ofeconomic profit.However,a sector analysisreveals that the distribution of this valuecreation was heavily skewed.In the intervening three years,we saw even moreadvances in technology and profound shifts inmindsets than predictedin part forced by theglobal pandemic.In our view,both the scopefor change and the willingness to execute ithave increased markedly in the industry,therebyredefining the art of the possible.We believe firmsshould continue their drive to unlock greater digitalvalue and,as COVID-19s impact gradually recedes,capitalize on a unique opportunity for creating thecapital markets of tomorrow.The buy-side generated 65%of industry revenuesand a massive 90%of the economic profit(see figure 1).This dominance is partly due tothe buy-sides“capital light”business model.The more“capital regulated”sell-side and marketinfrastructure businesses shared 35%of the totalrevenue pool in capital markets between thembut generated just 10%of the economic profit.We believe that the industrys pandemic-drivenrebound is a golden opportunity to accelerateinvestments in new technologies and new waysof working.From cloud to artificial intelligence,leaders should seize the chance to prepare theirbusinesses for the next wave of disruption andstrive for longer term success today.Capital Markets Vision 20254IntroductionSell-SideBuy-SideMarket InfrastructureConclusionThis gap is somewhat due to the seismicshifts in the regulation of banks capitalbases since the financial crisis.Figure 1:Breakdown of capital markets industry revenues by sector,2020US$Billions62However,the disparity has continued towiden in the years since our last major report.Back then,figures for 2017 showed the sell-sideand market infrastructure companies accountingfor 13%of economic profita share that hasnow dropped to 10%.177305673 Cost1,128189Equity CapitalCharge7216689Capital returns aside,the industry on anaggregated level hasnt improved overallefficiency.Our calculations put the averagecost-income ratio of capital markets firmsat 66.7%based on 2020 numbers,which isnearly unchanged from 2017(65.3%).Whileinvestment banking and exchanges showedsome improvement,there has been a rise ofcost-income ratios in asset management andasset servicing.That is not a sustainable trendfor delivering value in the future.170 Tax and other235119Top 16OtherMarketWealthAssetPrivateHedgeFundsTotalEconomic EconomicInvestment Investment Infrastructure Managers,ManagersMarketsRevenueExpensesProfitBanksand CIBsBanksand CIBsand AssetServicingPrivateBanks andBrokersEconomicProfit$5.9bn2.5%-$1.4bn-1.6%$6.8bn9.5%$27.3bn14.4%$27.1bn8.9%$37.8bn21.3%$15.6bn25.2%$119.1bn10.6%As%ofrevenueCapital Markets Vision 20255IntroductionSell-SideBuy-SideMarket InfrastructureConclusion towards the markets of tomorrowSteering large,complexWhile transformation is a constant in every industrytoday,we see the rate of change in technologyeven further accelerating the flux in capital marketsas we progress towards 2025.We believe thattrading volumes will continue to rise under theimpact of increasing global financial sophistication.The addition of tokenization could also open upnew avenues to invest and lend while reducingthe costs of doing so.This represents both anopportunity and a threat for the entire capitalmarkets industry.As a result,in our view,the biggest changesto come to the capital markets sectors in thenext phase of the industry will be as follows:organizations through todaysenvironment and setting themup for success is never going tobe easyand its harder givena future in which disruption willlikely accelerate.And while nosingle plan will be right for everyfirm,we believe that there isa common set of tools to beginthe journey to being an industryleader in capital markets by 2025.Each sector in the industry hasits own individual challenges andopportunities,and we will startby looking into the specifics ofeach sector in the next chapters.Sell-side firms will accelerate their strategictransformation programs,both in terms of changingbusiness scopes and perimeters and also in reshapingthe cost base to drive consistently higher profitability.Buy-side firms are expected to increasinglybecome“digitally native”meaning they wouldinfuse technology across their operating models,including into their investment process,clientinteractions and organizational culture.Also,the perceptions of buy-side firms will begin toshift from being alpha generators to being holisticstewards of capital,focusing on returns as just oneof many metrics across the environmental,socialand governance(ESG)spectrum.This same ethicalcompass shift will likely also become pervasiveacross the wider capital markets ecosystem.Financial market infrastructure players will findcompetition intensifying as exchanges and assetservicing firms clients start to disintermediateand compete with them.The Members Exchange(MEMX)is a case in point,but competition inareas from market data to settlement andcustody could also increase.3Capital Markets Vision 20256IntroductionSell-SideBuy-SideMarket InfrastructureConclusionAbout our methodologyIn developing our vision for capital markets in 2025,we analyzed publicly availablefinancial information from over 140 capital markets firms to define a clear view ofprofitability at the industry and sector-level.We explored trends over time using 2020 businessfinancial results as a baseline.We calculatedeconomic profit as a yardstick,deducting fromrevenues:credit losses,full operating costs,taxesand the cost of equity capital.While the costof equity capital will differ by company,sectorand region,to facilitate comparisons we applieda standardized rate(10%)across our research,generating an absolute economic profit figure forthe capital markets industry as a whole,each sectorand the underlying companies involved.global,leading,publicly-traded companies fromthe sell-side(i.e.,the markets and investmentbanking activities of a broad set of bankinggroups),buy-side(i.e.,wealth managers,assetmanagers,private equity and hedge funds)andfinancial market infrastructure(i.e.,exchanges andasset servicing firms).We discussed our observations and insights withvarious industry leaders focusing on the likelydevelopment of value pools going forward.Duringthese conversations,we also validated our thoughtson the key management challenges indicated byour findings for each sector of the industry.In our analysis,we focused on exploring theunderlying profit dynamics end-to-end across allcapital markets sectors.The scope included theCapital Markets Vision 20257IntroductionSell-SideBuy-SideMarket InfrastructureConclusionIntroductionSell-SideBuy-SideMarket InfrastructureConclusionFigure 2:Economic performance of IBGM businesses globally,2020In assessing the future of investmentbanking,its important to stress that therewill always be a need for the fundamentalrole played by the sector:intermediatingbetween corporates and investors.30%20%10%0%However,its equally clear that disintermediation incapital markets will not go away.So,the questionfor investment banks is not whether there willstill be a role for them in 2025,but what that rolewill look likeand how it will differ from today?And,even more interestingly,what is on thehorizon beyond 2025?-10%-20%-30%The remarkable strength of capital marketsrevenues in 2020 has brought the sector somerespite.We believe the current situationwith 2020results showing pre-tax profits being up by over$10 billion for the top businessesoffers theindustry the opportunity to finally grasp the nettlein terms of restructuring.It is vital that the sectornow avoids a return to the decade-long malaisethat followed the financial crisis.0510152025303540Revenue(US$Billions)Top 16 Investment Banks and CIBsOther Investment Banks and CIBsBubble size proportional to capitalCapital Markets Vision 20259IntroductionSell-SideBuy-SideMarket InfrastructureConclusionTo achieve this,we see three avenues for management teams to pursue inthe next few years:fix,focus and engage.These involve,respectively,makingrenewed efforts to invest recent gains in bending the cost curve;focusingmore closely on areas of expertise and advantage;and engaging moreholistically with clients.While these three strands of activity will likely be thepriorities for many sell-side players in the years to2025,any strategic discussion would also have to takeinto account a longer-term vision of the global marketsthemselves and potential developments within them.Capital Markets Vision 202510IntroductionSell-SideBuy-SideMarket InfrastructureConclusionInvestment bankingtoday:Seeking to recoverfrom a“lost decade”Since the onset of the Global Financial Crisis,the investmentbanking industry in general has struggled to generatemeaningful revenue growth.Aggregate revenues for the top 16 investment banks have fallen fromapproximately$286 billion in 2010 to nearer$267 billion in 2019an averageyear-on-year decline of 1%(see figure 3).In 2020,the industry saw revenuesof over$285 billionroughly back to the heyday of a decade ago.We do notbelieve this is some secular reversion.It is more a response to the pandemicand does not fundamentally alter the overall direction of travel for the industry.Capital Markets Vision 202511IntroductionSell-SideBuy-SideMarket InfrastructureConclusionThis steady slide in revenues until 2019is rooted in several factors.These includea shifting regulatory landscape,fast-evolvingcustomer behaviors and expectations,reduced volumes,increased competition,low interest rates and falling margins,along with liquidity stresses.Figure 3:Investment banks aggregate revenue performance,2010-2020Revenue(US$Millions)300,000250,000200,000150,000100,00050,0000A more detailed breakdown shows that investmentbanks core revenues(defined as FICC,equities,corporate advisory,and equity and debt capitalmarkets businesses)suffered the most,droppingan average of 3%a year.In response,firms havegrown revenues in other areas.For some banks,these efforts have included seekingsynergies by moving business lines from theircorporate banking or private banking and wealthmanagement businesses closer to the investmentbank.Others have pursued new activities,20102011201220132014201520162017201820192020Core revenuesOtherexpanding into areas like trade finance,securitiesservices and transaction banking.Some havemoved toward retail deposits and loans.Capital Markets Vision 202512IntroductionSell-SideBuy-SideMarket InfrastructureConclusionWhile such initiatives have yielded some successin terms of revenues,two things remain clear:Figure 4:Global investment banks RoE 2010-2020 top nine,and excluding the top five US banks First,the beating heart of the investmentbanking business has seen profound changeover the past decade.12%10%8%Second,within that core,returns remain inadequate.6%Even when we strip out the smaller playersand look only at the top nine globalinvestment banks,group returns on equityhave almost consistently failed to beatfirms cost of equity capital,whichforthis paperwe assume to be 10%.Thepicture becomes gloomier still if thefive biggest US investment banks areexcluded(see figure 4).4%2%0%-2%-4%20102011201220132014201520162017201820192020Top 9 investment banksExcl.the top 5 US investment banksCapital Markets Vision 202513IntroductionSell-SideBuy-SideMarket InfrastructureConclusionStructural factors give US banks an edgeThe glaring disparity between the(largelyUS-based)bulge bracket banks and theirpeer group reflects several factors.However,another factor that may be equallyas important is the level of returns from thenon-capital markets elements of the top nineglobal investment banks business portfolios.Here the higher returns available in,for example,the USs vibrant retail and commercial bankingsegment give the US banks a significant advantage,as figure 5 showsat least until 2020.First,the US sell-side is almost certainly moreprofitable from a structural perspective.Beinglocated in the worlds largest and deepest capitalmarket has helped to bo