Citation :
No matter what part of the financial services or banking ecosystems you look at, revenues are harder to come by today than they were 10 or 20 years ago.
- Trading commissions have fallen, with online brokerages ushering in zero commissions.
- Bid-ask spreads for market makers have narrowed.
- Management fees for mutual funds and hedge funds continue to shrink.
- Mutual funds are losing market share to low-cost exchange-traded funds.
- Net interest margins for banks have been compressed by both low interest rates and a flatter yield curve.
- The Volcker rule restricted some of the more lucrative activities banks can do.
- Higher capital requirements have reduced the profitability of the banks.
- Loan growth has been anemic since the financial crisis.
- And increasingly, private companies are looking to do direct listings on stock markets rather than initial public offerings, threatening bank underwriting fees.
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It's been a bit more than a decade since the financial crisis, and banks and financial-services firms have had enough time to dust themselves off and adjust to the new environment for the industry.
If the 2000s were defined by the bust, and the 2010s were a period of recovery and sluggish growth, then maybe the 2020s will be when the industry consolidates and finally lowers costs by shifting to cheaper cities.
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