The financial services industry is set to undergo fundamental change that will destroy half of all jobs, Anthony Jenkins, the former boss of Barclays Bank believes. Money won't suffice to keep the best talents in banking.
Anthony Jenkins, 54, isn't known for sexy quotes and for playing to the gallery; as a diligent, but quiet worker he carved out a career in the business with high-street clients away from the limelight of the City. It helps him understand the problems of ordinary people and less so the world of Wall Street reverberating from Ferrari V12 engines.
All the experience didn't help him though to put Barclays back on track – his reorganization didn't convince shareholders and Jenkins was asked to leave half way through the process, last summer.
The «Uber Moment»
Since then, the Brit has been busy observing the banking industry and offers sobering comments. In his recent speech at London's Chatham House Jenkins presented the scenario of a financial services industry approaching the «Uber Moment».
Jenkins concludes that technological progress, which revolutionized industries such as transport (Uber/taxis), accomodation (Airbnb/hotels) and moving pictures (Netflix/film industry) won't stop at the financial services industry. With the developments underway in the fintech laboratories, Jenkins sees little alternative to a fundamental shake up.
Wave of New Banks
The banker expects every second banking job to disappear over the coming decade. The development is unstoppable and will lead to better service for customers and a wave of newly founded banking institutes. Even if he applied a less dramatic scenario, every fifth job will be culled, Jenkins says.
Some of the new banks won't have branches, pointing at Atom Bank in the U.K., which will take up business next year. Jenkins doesn't see this as a spleen of some techno nerds, because Spain's BBVA invested 45 million pounds in Atom Bank – acquiring a 30 percent stake.
Mergers to Follow
The new banks will tower over the traditional institutes because they will operate with much lower costs and completely new IT. Older banks will be able to survive longer than established companies in other industries, because of the significant entry costs in banking. A wave of mergers will be the consequence.
Banks will continue to need the best trained people available to survive in an extremely competitive environment. Jenkins believes that money won't be enough to retain the best, because they can choose whether they want to work in technology firms, multimedia or at banks.
