Financial institutions are bracing for economic uncertainty in 2020, with 97% of executives feeling the pressure to deliver better financial insights.

The new Kaufman Hall report 2020 Outlook for Financial Institutions can help financial executives at banks, credit unions, and farm credit associations better understand industry challenges and opportunities so they can chart a confident path forward. These insights can help set the stage for a better 2020 — and beyond.

Infographic: 2020 Financial Outlook



To compete with other local financial institutions as well as tech companies like Google and Apple — which now offer banking and payment services such as PayPal, Venmo, Zelle, and Cash App — financial professionals need a single source of truth that is accurate and simplifies reporting and analysis.

But there are significant challenges to improving financial planning and analysis:

  • 69% experience resource constraints
  • 53% have outdated/insufficient processes
  • 34% struggle with insufficient tools

Top challenges cited around reporting in 2020 include:

  1. Pulling data from multiple sources into a single report (64%)
  2. Creating better dashboards and visualizations (62%)
  3. Drilling into reports to understand underlying data (59%)
  4. Accessing clean, consistent, and trusted data (55%)
  5. Delivering meaningful ad hoc reporting (51%)

Many institutions lack sufficient profitability insights to know where to focus and invest. Only 16% of survey respondents have a clear understanding of their profitability based on profitability analysis.

Without factoring in risk, institutions can’t accurately analyze which branches, products, and customers/members drive profitability — 54% of respondents lack profitability analysis tools to calculate the risk-adjusted return on capital (RAROC).

There is also a significant gap between what finance leaders feel is important to monitor and what they actually measure and track. For example, 94% say it’s important to monitor customer profitability, but only 43% do so.

Read the 2020 Outlook for Financial Institutions to learn more about challenges, opportunities, and how to chart the best path forward.