The investor survey is part of IBM's ongoing worldwide research into investor sentiment and the banking industry, which confirms that desire is growing among consumers for unbiased financial advice.
The survey found that:
- Only 27 percent of investors surveyed indicated they would cut investment contributions, compared with 35 percent who said they would cut holiday spending;
- 75 percent of investors will maintain or increase their investment contributions;
- 82 percent of investors have no plans to withdraw funds from their retirement accounts.
The survey was conducted by Braun Research and was based on telephone interviews with 1,000 U.S. investors from November 6, 2009 to November 13, 2009. It has a 2.5 percent margin of error.
New banking study from Institute for Business Value
The survey builds upon an extensive global research of the banking industry that the IBM Institute for Business Value (IBV) conducted over the past year and published in a report, entitled Fit, focused and ready to fight: How banks can get in shape for the battle ahead.
"The banks that emerge from the current economic crisis as winners will be the ones that are focused on client's success," said Shanker Ramamurthy, IBM's Global Industry Leader, Banking & Financial Markets. "But restoring client relationships is only part of the solution - banks must also become far less complex and develop an enterprise-wide view of risk."
According to the IBV report, banks should invest in analytics to gain an understanding of clients' perception of value and what they are willing to pay a premium for. Today, banks rely on less useful demographic metrics, such as age, health, and stage of life. Improved segmentation will lead to a healthier, more sustainable relationship with clients and, in turn, a more profitable one.
The report notes that an integrated risk management framework helps banks transcend organizational silos and cohesively address financial risk, fraud and compliance reporting. Banks need to invest in analytics to manage risk at the organizational level and provide inputs to evaluating risk at the systemic level.
On the financial front, while banks need to strengthen their capital, the equity markets are constrained by the decline in public wealth and investor confidence in banks' loan portfolios. In addition, banks have a high cost of operation in many parts of the world, rendering the operating models of the past obsolete. As a result, banks should lower operating costs through business model changes that are supported by long-term savings initiatives in areas such as IT, shared services and front/back office integration.
IBM research also indicates that the industry is likely to undergo a period of divestitures and mergers and acquisitions.