Three ways banks can reduce costs & manage risk in 2023
For banks in 2023, debt defaults and bad debt provisions will combine to reduce profits - giving them even more reason to find efficiencies and lower costs. Also, regulators will step up their efforts to make sure banks avoid outages and SEV 1 incidents.
Banks will want to avoid fines such as the one TSB received in 2022. Inflation boosted interest rates around the globe in 2022, and they are unlikely to reverse in 2023. For consumers, companies and banks, interest rates will remain a pain point. As the FT said: “The era of cheap money is over.”
Banks will have to be much more cost-conscious and risk-averse to protect their profits through the next 12 months. Here are three ways they can find efficiencies and proactively identify risk in their IT estates in 2023:
1. Cloud cost optimization
Financial services firms are rushing to the public cloud providers (such as LSE’s deal with Microsoft). This may give them some advantages, but it may also convert what was largely capex into opex spend, making it more expensive than they think when moving more of their IT estate across. With cloud cost optimization you can find cold spots in your data centers, see where your cloud estate is wasting money, and remove them.
2. 360-degree full-stack monitoring
Customer acquisition and reduced churn are essential to maintain and grow the “top line.” Knowing what your customers are experiencing with your services, finding the issues and resolving them quickly is key to not losing customers. Or attracting bad comments on social media. High quality digital experience monitoring (DEM) and internal monitoring are crucial.
Regulators are expecting financial services firms to improve reporting on business-critical services, with increasing global operational resilience regulations mandating it. This can only be achieved by capturing the detailed data about what is happening in your IT estate by using an observability platform. From this, reporting is more easily achieved and techniques like site reliability engineering (SRE) allow you to improve consistent performance and resilience.
Click below to find out how the ITRS Observability & Monitoring Platform can help your firm get more out of its IT environment in 2023.