Many banks, in reality, are faced with a dilemma: if they were to go about digitizing their business at full speed and to stand up to the challenge of the tech firms, they’d have to cut thousands of jobs as they become redundant with technological progress. But no CEO will touch such an unpopular measure. Instead, banks reinvent themselves every other year, be it with one-stop financial services, banking with affluent people, segmentation of customers, investment banking or geographic expansion. Much of this is mere window dressing because it doesn’t do justice to the radical structural change underway. And this is what affects the share price.
In addition, there is hardly an industry that has jeopardized the trust of clients and investors in the recent past as much as banking. It has left the general public with an ill feeling that is almost beyond repair. And as long as the big Swiss banks continue to get caught up in new financial scandals, people’s appreciation of the banking industry won’t take a turn for the better. This is the reason why surprisingly few people are greatly interested in a business that is hugely significant to our economy.
Back to the Christmas Dinner
The shares of big Swiss banks won’t be relieved from their plight as long as performance, high managerial salaries and trustworthiness in banking are not in balance. Or put another way, the decline in value of the shares makes sense. Be it as it may, it would be a great idea if Credit Suisse reinvented its annual Christmas dinner and the stock competition. The latter was a good indicator for what the bank was really worth.
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