McKinsey – Global Banking Annual Review 2024: Attaining Escape Velocity, Oct 2024

This annual review by McKinsey explores strategies for banks to achieve "escape velocity" amid complex financial challenges. The report identifies rising interest rates, digital transformation, and competitive pressure from non-traditional players as key forces reshaping the banking sector. To remain profitable, banks must boost cost efficiencies, with many needing to reduce expenses at 2.5 times the rate of revenue decline. Emphasis is placed on strategic investments in AI and digital tools, but banks must balance these innovations with regulatory compliance and operational resilience. The report also highlights high-performing banks that leverage AI, optimize net interest margins, and pursue sector-specific growth strategies to maintain strong returns on equity.