Banking - Europe

Europe

In 2024, the projected Net Interest Income in the Banking market in Europe is estimated to reach €1.09tn.
Traditional Banks are expected to dominate this market segment with a projected market volume of €0.74tn in the same year.
Looking ahead, the Net Interest Income is anticipated to demonstrate an annual growth rate (CAGR 2024-2029) of 2.78%, resulting in a market volume of €1.25tn by 2029.
When compared globally, it is noteworthy that China is expected to generate the highest Net Interest Income, amounting to €3,976.0bn in 2024.
In the banking market in Europe, Switzerland continues to be a global leader in private banking services.

Key regions: United States, China, Japan, Brazil, United Kingdom

Definition:

The Banking market refers to the financial services sector providing financial products and services to individuals and businesses. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.

Structure:

The market consists of two segments:
- The Traditional Banking market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels.
- The Digital Banking market refers to the emerging market for digital-only banks that offer financial services through online and mobile platforms.

The market data comprises Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the Retail & Commercial banking market, creating opportunities for new entrants, and forcing existing players to adapt.
Key players in this market are companies such as the Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Región

Comparación de regiones

Moneda

Analyst Opinion

The global banking market is a highly competitive and dynamic industry that is constantly evolving to meet the changing needs of consumers and businesses.

Traditional banks have a long history in the industry and are well-established players. They offer a wide range of financial products and services, including savings accounts, checking accounts, loans, mortgages, and credit cards. These banks typically have a physical presence, with branches located in various cities and countries. They also have extensive networks of ATMs and other banking facilities.

On the other hand, neobanks are relatively new players in the industry that operate entirely online. They offer similar financial products and services to traditional banks but with a focus on convenience and flexibility. They use digital technologies to provide a seamless and frictionless banking experience, often with no fees or low fees. Neobanks also leverage data analytics and AI to offer their customers personalized financial advice and recommendations.

In recent years, neobanks have seen significant growth, especially among younger consumers who prefer digital channels for their banking needs. However, traditional banks still hold the lion's share of the market, and many of them have launched their own digital banking platforms to compete with neobanks.

One of the biggest challenges facing the retail and commercial banking industry is regulatory compliance. Banks must comply with a myriad of regulations, including anti-money laundering (AML) and know-your-customer (KYC) regulations, which can be costly and time-consuming. Moreover, data privacy and cybersecurity concerns have become increasingly important, especially in light of recent high-profile data breaches.

Another challenge is the changing consumer behavior and preferences. With the rise of digital technologies, consumers are becoming more accustomed to personalized and convenient experiences. Banks must adapt to these changing expectations by providing more personalized products and services and leveraging data analytics and AI to offer more relevant recommendations.

In addition, the COVID-19 pandemic has had a significant impact on the industry, with many consumers and businesses turning to digital channels for their banking needs. This has accelerated the shift towards digital banking and forced traditional banks to adapt to changing customer demands.

Additionally, the peak of inflation in 2022 affected the market. For more details about the impacts of inflation on the financial industry read more here.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.