Banks must act now or risk becoming a 'footnote', cautions McKinsey

Banks allocate just 35% of their information-technology budgets to innovation, while fintechs spend more than 70%, McKinsey said

More than half of the world’s banks may be at the risk of not surviving another downturn, suggests a survey from consultancy McKinsey & Co.

A majority of banks globally may not be economically viable because their returns on equity aren’t keeping pace with costs, McKinsey said in its annual review of the industry released Monday. It urged firms to take steps such as developing technology, farming out operations and bulking up through mergers ahead of a potential economic slowdown.

“We believe we’re in the late economic cycle and banks need to make bold moves now because they are