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As we approach the close of 2024, the lending and banking sectors continue to advance amidst a dynamic economic landscape. In this edition, we focus on the key insights and trends shaping the industry, including the evolving regulatory environment, the ongoing impact of inflationary pressures, and the latest trends that are poised to take shape in 2025.
In our ESG spotlight, we delve into how financial institutions are increasingly integrating sustainability into their core strategies, which is not only influencing the market but also driving long-term value creation for both lenders and borrowers.
In light of the recent policy changes, we explore the potential impact of the anticipated interest rate cut, examining its effects on lending margins, capital flows, and overall sector stability - as understanding these dynamics would be critical for navigating the coming months.
As part of our industry interactions, we recently concluded a power-packed webinar on "Unlocking Opportunities in the Commercial Mortgage Market," with leading experts exploring the evolving commercial real estate market. Additionally, we invite you to register for our upcoming webinar on "Navigating Sustainable Finance – The Next Frontier in Banking," to explore how banks are tackling net zero goals, managing ESG risks, and leveraging AI for better reporting.
We hope this edition provides valuable insights and actionable intelligence for you to drive success in a fast-changing environment.
Rajul Sood, Managing Director, Lending Services
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Perspectives and Opinions |
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| Impact of interest rate cut on the banking sector |
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New trends and opportunities in SME lending |
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The Federal Reserve cut the interest rate by 50bps for the first time in over four years, while anticipating further cuts in the future. While the rate cut can be considered a positive step, its effects will be gradual, and loan growth may not fully offset lower net interest income for banks.
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SMEs today are driving innovation and growth, with their progress fuelled by digital-lending transformation, improved cross-border financing, supportive regulatory policies, rise of impact investing and expansion in fintech to meet the unmet financial needs of SMEs.
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| Fintech firms – tough competition to US banks in the cash management account segment |
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The rise of NAV lending – unlocking liquidity for investors |
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Traditionally, only banks used to offer checking and savings accounts to customers. However, with the rise of fintech firms, megabanks are facing tough competition. Explore this blog to know the key factors driving this trend, and how banks can overcome this challenge.
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The rise of NAV lending has completely changed how investors manage their financial demands and access liquidity. This innovative lending strategy offers improved liquidity, flexible capital allocation and lower borrowing costs. Read this blog to know about the growth, benefits and risks involved.
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Sector Insights and Trends |
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| Major technological trends in the electric transport market |
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Ageing gracefully – a glimpse into the evolving global senior-housing market |
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Growth momentum in EVs is expected to remain driven by long-term cost savings, environmental concerns, expanded offerings by automakers, and government incentives, among others. Check out this blog to learn more on the progress in the EV space, and the benefits of electric transportation.
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As life expectancy rises and the elderly population grows, demand for senior housing is expected to surge, increasing the number of investment opportunities. Read this blog to know about the trends driving senior housing-market growth, and the opportunities for stakeholders.
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| AI & ML – transforming the US insurance sector |
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Enhanced loan operations in banking |
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With the continued improvement of AI-powered technologies, insurance companies that incorporate these technologies are gaining a competitive edge. Check out this blog to know more about how AI is restructuring the insurance sector, and the factors driving its integration.
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Loan operations being a vital part of revenue for any banking system, it is essential that an organisation spend enough time to ensure quality decisions. However, with the lending procedure being lengthy, there can be several challenges that banks need to overcome in order to enhance their operations.
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ESG Spotlight |
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| Green Loans & Sustainability-linked loans: A powerful tool and an unwavering ESG commitment to secure future |
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Navigating the new era: China’s bold ESG disclosure mandate for listed companies |
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The idea of green finance plays a vital role in promoting balanced and rational growth, encompassing financial instruments such as green bonds, establishments such as green banks and funds such as sustainability-linked loans. Explore more here.
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China’s new ESG disclosure regulations are expected to drive standardisation and consistency in ESG disclosure globally, and its approach to ESG reporting can have a significant impact on the trends of its economic landscape and the direction of international investment flow.
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| 2024 Sustainable Finance: Key Regulations and Emerging Trends |
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From risk to resilience – the role of ESG in modern collateral management |
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Read this blog for an in-depth analysis of the regulatory landscape for sustainable finance in 2024 and insights on current regulations, emerging trends, challenges, opportunities and the outlook of this dynamic field.
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Collateral management involves the administration of collateral to mitigate credit risk in financial transactions. However, the increase in ESG-related criteria has added a new dimension to these practices, demanding that collateral be not only financially sound but also aligned with broader sustainability goals.
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Featured Solutions |
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| Implementing a successful offshoring programme for lenders and other CRE players |
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BEAT CreditPulse |
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Implementing a successful offshoring program can provide you with unparalleled advantages like cost efficiency, access to global talent pools, and round-the-clock productivity, among others.
Check out this video to explore the opportunities that offshoring can bring.
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Introducing our proprietary large language model based tool - CreditPulse, which can be used to create summarised commentary for fact-based analysis. This tool has been created with our in-depth knowledge of the lending value chain and corresponding technology landscape.
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Industry Interactions and Events |
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Here’s a glimpse into our insightful webinar, where you can explore the evolving landscape of the commercial real estate (CRE) market amid economic fluctuations. Our panel of senior industry leaders discuss the impact of rising interest rates, property value fluctuations, and the importance of strategic partnerships in navigating these challenges. |
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With the demand for sustainable finance growing, this webinar will explore how banks are integrating sustainable financing principles into their core strategies through robust client transition plans, aiming for a smooth and compliant shift toward more sustainable operations. |
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PR Mentions |
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| Regulating the lenders: RBI’s focus on fair and transparent lending |
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Q&A with Rajeev Hota, Acuity Knowledge Partners |
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| The Resurgence of Investment Banking Drives Higher Bank Earnings in 2024 |
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Big investment banks set for 30% rise in advisory, underwriting revenues in 2024 |
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Acuity’s DE&I Mission and Vision |
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Diversity Equity & Inclusion
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Diversity Month has always been a time of celebration and reflection. This year, Acuity hosted DEI Universe, a platform to celebrate the multiverse of voices that we are. All six of our diversity networks came together to celebrate our shared commitment to inclusion. Pop-up stalls were setup, showcasing the work of volunteers from each network and offered fun games and engaging activities for participants. |
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ABOUT ACUITY KNOWLEDGE PARTNERS
Acuity Knowledge Partners (Acuity) is a leading provider of bespoke research, analytics and technology solutions to the financial services sector, including asset managers, corporate and investment banks, private equity and venture capital firms, hedge funds and consulting firms. Its global network of over 6,000 analysts and industry experts, combined with proprietary technology, supports more than 500 financial institutions and consulting companies to operate more efficiently and unlock their human capital, driving revenue higher and transforming operations. Acuity is headquartered in London and operates from 10 locations worldwide.
Acuity was established as a separate business from Moody’s Corporation in 2019, following its acquisition by Equistone Partners Europe (Equistone). In January 2023, funds advised by global private equity firm Permira acquired a majority stake in the business from Equistone, which remains invested as a minority shareholder.
For more information, visit www.acuitykp.com
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US: +1 929 618 0217 | UK: +44 20 7550 4499 | India: +91 80 6113 3000
Sri Lanka: +94 11 235 6000 | Beijing: +86 10 8248 6812 | HK: +852 3002 4980 | contact@acuitykp.com |
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©2024 Acuity Knowledge Partners. All rights reserved. |
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