On the afternoon of March 20th, Professor Randall O. Chang visited the MBA Education Center, and discussed with the students the development trend and challenges of banking，and analyzed the survival struggle of small and medium-sized banks in the school auditorium. The lecture was presided over by Zhu Wenzhong,executive dean of the School of Business.
Professor Randall first analyzed the development trend and challenges of banking from the perspective of globalization. He pointed out that the more stringent regulatory environment, prominent customer retention issues, rampant cybercrime and the fierce competition between non-bank financial enterprises and banks are major factors affecting the development of banking today. Together with the survival problems of small and medium-sized banks, they constitute the five major challenges for banking.Among them, the more stringent regulatory environment is reflected in the enhancement of independent risk monitoring,risk management scenario prediction and other aspects;and the greedy sales-driven model reduces customer’s confidence in banks, which has resulted in the loss of bank loyal customers. In addition, by comparing the past and present, he also said that the banking system could not keep up with the pace of technological innovation, which led to cybercrime increased rather than declined while the banking risk management costs continue to increase. When it came to the fierce competition between non-bank financial enterprises and banks,Professor Randall stressed that the growth of shadow banking, mortgage companies and other non-bank institutions which have similar functions with banks, had made banking face more challenges.
As for the survival and development trend of small and medium-sized banks, Professor Randall put forward a key word: merger.Taking the United States as an example and through the comparison and analysis of charts and figures, it is easy to see that the large banks are larger and larger and their wealth concentration is greater and greater, while the development of small banks is difficult, and their total is decreasing.He summed up three factors that made large banks beat small banks: strong advertising, advanced technology, and the cross-state limitations.But he also pointed out that small banks focused on serving local families and businesses, and the service was more humane. Therefore, he came to the key to the survival of small and medium-sized banks: 1)customer-centric 2)providing personalized service.
Finally, Professor Randall said that the latest development trend of small banks was the alliance, and the relationship between small banks should be cooperation rather than competition.He stressed that although banks were dealing with money business, banking indeed was a place for people to develop their relationship with others. dealing with the industry. If small banks want to continue to develop, they have to be customer-centric and pay attention to market differentiation, otherwise they will only turn into a ray of clouds and disappear in the wind.
In the interactive section, Professor Randall and MBA teachers and students discussed the differences of banking organization and management between China and the United States , as well as the existence and development of large banks and small banks and other issues.
