Cambridge Business Association
How North American Banks Can Revive Shareholder Value
Report

How North American Banks Can Revive Shareholder Value

Boston Consulting Group
Boston Consulting Group, 2019
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Editorial Rating

8

Qualities

  • Applicable
  • Overview
  • For Experts

Recommendation

Between 2014 and 2018, only the largest North American banks garnered returns greater than the S&P 500, while many more financial institutions’ growth was inefficient. This authoritative analysis from Boston Consulting Group professionals advises that if these banks want to improve their financial performance, they need to do a lot more than cut costs – they have to transform themselves on several fronts. This report offers useful decision guidelines to financial executives concerned about bank competitiveness.

Summary

The performance of most banks in North America has largely tracked the market.

In only a few instances have these financial institutions done better than the S&P 500, which gained an average of 8% per year from 2014 to 2018 in total shareholder returns – dividends plus share price appreciation. Post-2008 regulations have burdened many banks, though some of the more stringent limitations are set to roll back. Nonetheless, banks have a lot of work ahead to improve their shareholder value.

In North America, the most successful banks generated value by raising their tangible book value...

About the Author

The Boston Consulting Group is a leading global advisory firm. 

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