Bloomberg Businessweek Consumer Banking, Global Business Schools
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Dec 10, 2024 Brendan Coughlin, Vice Chairman and Head of Consumer Banking at Citizens Financial Group, shares strategic priorities aimed at reshaping consumer banking by 2025. He discusses post-COVID trends, highlighting shifts in spending patterns and the impact of interest rates on mortgage refinancing. Coughlin also addresses the industry's move to private banking offices, aligning with the evolving needs of consumers. Manuel Muñiz, Provost of IE University, adds insights on the need for diverse educational experiences in business amidst global challenges.
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Consumer Spending and Deposits Post-COVID
- Consumers have normalized spending post-COVID, but deposit levels vary.
- Mass affluent and affluent consumers still hold 20-25% more cash than pre-COVID, while mass market consumers are back to pre-COVID levels.
Impact of Interest Rate Cuts
- Small interest rate cuts won't significantly change consumer behavior, impacting deposits and credit card debt slightly.
- Larger rate drops are needed to trigger a refinancing boom, as most homeowners have rates below 5%.
Citizens Financial Group's Growth Strategy
- Citizens Financial Group has been actively acquiring companies and expanding its wealth management services.
- They are open to further M&A opportunities but prioritize organic growth and geographic expansion, potentially through private banking offices.