Economics
Asia's Bank Profits Face a Powerful Storm, McKinsey Says
- Slower growth, weaker balance sheets may cripple ROEs
- Asia Pacific accounted for 46% of global bank profits in 2015
McKinsey Says Asian Banks Face 'Powerful Storm'
This article is for subscribers only.
Asia-Pacific banks face “a powerful storm” which will probably hurt profit growth in an industry that earned half a trillion dollars last year, according to McKinsey & Co.
A triple threat of slowing economic growth, technology disruption and weaker balance sheets could come together to “cripple” returns on equity by 2018, the New York-based consultancy said in an analysis of 328 banks in the region. Profit growth may slow to below 4 percent annually between 2016-2021, down from about 10 percent in 2011-2014, said Joydeep Sengupta, one of the report’s authors.