Wells analyst: The 2020s will be a "golden age" for banks and technology

Wells analyst: The 2020s will be a "golden age" for banks and technology

Wells Fargo banking analyst Mike Mayo has forecast that the coming decade will be a "golden age of banks and technology", as IT insiders move up the ranks of management and banks emerge from wreckage of the financial crisis.

The veteran bank analyst believes that banks are now in better shape to take advantage of their huge technology budgets following three lost decades in which bank consolidation, excessive growth and the financial crisis spurred a muddled approach to tech spending.

With the clean-up from the financial collapse now completed, he says: "Technology is better-enabled for banks than ever before and banks are more receptive to using technology than ever before. Tech is the enabler that will take banks on a multi-year trend of improving efficiency and delivering better returns with a lower-risk profile."

Much of this will be driven by a newly empowered, IT literate C-Suite seeking to take advantage of shifts in technology to finally deliver on the promise of full digital engagement and integration.

“You now have the chief technology officer in the c-suite for most of the largest banks,” he told Yahoo Finance’s On the Move. “The chief technology officer needs to have more power to enforce the technology solutions that cut across so many different business lines.”

With bank stocks wrapping up 2019 on an all-time high, Mayo says that the drive for better returns from the industry's $150 billion per annum tech spend will lead to a decade of unparalleled returns for shareholders.

“We see this as a win-win-win decade ahead," he says. "A win for the customers, who have better service; a win for the regulators and society because banks are a lot less risky, and a win for the shareholders.”

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