Fifty-five percent of senior bank executives in a recent KPMG survey said that regulatory compliance costs are having the greatest negative impact on their banks' growth. Forty percent cited regulatory limitations on products and services, followed by weak loan demand (36%) and the low interest rate environment (31%).
In addition, 60% of the respondents estimated that regulatory compliance requirements accounted for as much as 10% of their total operating costs, while 22% said it comprised 11 - 20% and 9% said it was more than 20%.
The survey also found that 27% view the mass affluent (defined as the top 10% of income earners) as the customer segment presenting the greatest growth opportunity, while 23% view the underbanked (customers without access to incremental credit) as such, up from 12% in last year's survey. Twenty-one percent cited young rising professionals as the top segment.
Other survey questions explored topics such as branch banking, mobile payments and IT planning.