August 28, 2017
In the latest episode of Forrester’s What It Means podcast, Senior Analyst Peter Wannemacher discusses how the traditional banking model is fracturing – making way for an open model that will reward those banks that adapt to customer expectations and behaviors unlike those that helped shape the current model; a fintech market that is creating a low level of havoc; and new regulations that further open the market and erode natural bank strengths. Banks need to strategically engage this new reality to win – otherwise they will likely become unintentional financial utilities.
Victor Milligan: Hi, I’m Victor Milligan, your co-host from Forrester’s podcast, What It Means, where we explore the major changes in the market influencing executive priorities. And I’m flying solo this week for the well-deserved vacation for Jennifer Isabella. I’m talking today with analyst Peter Wannemacher on the disruption in the banking sector, what it means to banks, and how we think they’re going to respond. Welcome, Peter.
Peter Wannemacher: Hello. Thank you for having me.
Victor Milligan: So we’re at the early stages of seeing the longstanding, traditional banking model being fractured. Could you just give a sense of where we are in the banking model and how you see some of these fractures emerging?
Peter Wannemacher: Yeah. So what we’re seeing is financial services as a market and financial services institutions are coming to a fork in the road. I think it’s tempting to look around and feel like everything’s already been disrupted. There are many people that get on stages and say things like, “Banking is already dead,” and, “Financial services is over.”
Victor Milligan: So, Peter, that’s true because I think the way I look at it is that there’s general consensus as to why the clouds are sort of looming. What’s the storm look like? But maybe there’s an overstatement about how unprepared or how unwilling the banks are to move. Let’s just go through the causes of sort of the changes that are affecting this business model. And we’ll go through it one by one and looking first at probably what’s happening most severely which is the changes in the customer behavior. Let’s start with trust. 2016, there’s over $300 billion of fines and settlements paid by banks for issues like money laundering, other types of issues which, one could argue, has an accumulated effect on the trust of banks. But what you found is a little bit more nuanced than that as it relates to trust.
Peter Wannemacher: Yeah. I think that’s right. Our research shows that it’s more complicated. So I’ll say something that’s a little bit counterintuitive given all of that data, which is that in many developed markets including US and Canada, financial services customers trust their providers more today than they did before the Great Recession. That said, I think that the quickest analogy we could make is that consumers’ views on financial services and financial services providers is a bit like citizens’ views of Congress in the US but also in other markets. They dislike financial institutions in general, right? Just like they dislike Congress as a body, as an entity. And yet they tend to like and trust their individual provider, especially when we’re talking about their primary financial relationship. So, “My bank, my credit union. I tend to have a fair amount of trust in them.” There is, as we’re starting to talk about, a risk of erosion of that trust which is essential to the relationship that can impact emotional connection, which we’ll talk about. At the same time, there is a risk that that trust may not matter enough, right? It is not enough to sustain long-term growth if the customer starts to have other relationships with what we would call disruptors or disintermediaries; Folks that are getting between the bank, the brokerage, the insurer, and that customer.
Victor Milligan: Right. So that the concept would be if trust is such a strong emotional motivator, which is, “I really need to trust you. I may keep my existing dollars with you and my next dollars with you because my trust is my big point of decision.” But if trust begins to be sort of a moderate thing, “I don’t distrust you, but I’m not basing my decisions on trust. I’m freer to move around.”
Peter Wannemacher: That’s right. And what we see is that people make lots of financial decisions every day. The big ones, the moves from one provider to another, especially from one primary to another, tend to be driven by a number of different attributes. But the primary driver of that decision is often a life event. So that’s marriage or separation or divorce, right? So we would call various demographic shifts. We also would look at various career shifts, things like getting a new job, obviously geographic shifts, so moving to a new city. And these often correlate with each other. What we see is that the number one driver of financial product purchasing is a life event of some sort. That, then, moves the customer to start to reconsider their brand relationships. And that’s where the risk is. And as you said, too, if you’ll indulge me for a moment, that idea of the risk is not attrition but where they put their next dollar, who they trust to make their next financial decision with them or to help them make that decision, there’s a parallel in the past which is brokerage firms. The traditional brokerage houses throughout the 20th century were sitting pretty in a lot of ways. In the ’80s and then into the ’90s, we started to see direct firms and then online brokerage opportunities offering services as well as new companies, firms like Vanguard, then Schwab, and E*TRADE. And what we heard, what Forrester heard from executives at those traditional brokerage houses was, “We’re not worried because we’re not seeing significant uptick in attrition or customer churn.” The problem was that wasn’t what was going on in the market. The customers were staying with them. Their clients were still continuing the relationship at some level, but they were putting their next dollar with an E*TRADE, with a Vanguard, with a Schwab. And that eventually became a much wider disruption which, again, led to disintermediation and commoditization.
Victor Milligan: You mentioned brand, Peter, and brand’s a funny thing because a lot of people will spend on the basis of brand. But we’re finding is that increasingly it’s a level playing field meaning that the banks may not have built up sufficient brand equity to secure the next dollar. 33% of people surveyed say they see banks the same. They don’t really see any big difference among them. It’s a pretty dangerous number.
Peter Wannemacher: It is dangerous, and it should be scary to every bank executive, and frankly, it should be scary to every wealth management company executive, and insurance company executive as well. Banking is often the leading indicator, not always but often. That’s right. The idea and the stat you just referenced, the statement that they agreed with was, “All banks are basically the same.” That is pretty much the definition of a commodity.
Victor Milligan: Yeah. So as a customer, I’m operating as a free agent. I can go anywhere.
Peter Wannemacher: That’s right. And that’s always been a kind of a dirty secret in financial services is there is what we would call loyalty which is the desire to stay in that relationship. There’s also what one might call stickiness which is the resources and effort it takes to extricate yourself from that relationship. So if I’m a Target customer, if I want to stop being a Target customer, I just don’t go back to Target. It is a very simple procedure. If I am a Bank of America customer or– I’m not picking on them, any bank. If I decide I don’t want to be a customer of theirs anymore, I have to actually work to get myself out of that and into a new relationship because, in the modern day, there isn’t the option of simply unbanking, although we’re seeing an increase in that a little bit, but that’s a little bit farther out.
Victor Milligan: Yeah. It’s interesting. The way I look at it sometimes is there’s four different kinds of markets that there’s ones that you’re locked into, like the government. You can’t be a citizen elsewhere just because. There’s the committed which is underpinned by contract and the barriers to exit are very high. Loyalty’s much more of an emotional play and then free agents. And it seems like a lot of the industries, including banking, see themselves as a quasi-committed space where, maybe not be a contract, but the barriers to exit are high enough that churn is improbable or it’s managed down to the single-digit level. But it doesn’t still comment on the earlier point, on enrichment, because I’m not exiting something. I’m simply entering something new. So enrichment is much more of a free agent market.
Peter Wannemacher: Yeah. And financial services companies know this. There’s a CMO of one big bank – I won’t say which – that used to draw on every whiteboard in the company a little picture of how many products, how many services and products each customer would have and how profitable they were based on that. So a customer who only had one product or service with them was, on average, not profitable, negative, I should say, unprofitable. Person who has two, barely above profitable. Three, significantly, and it grew exponentially from there. And this is true in lots of industries.
Victor Milligan: Yeah, it’s almost the depiction of the business model right there, which is the lifetime value is premised on the idea that I will maintain the customer and enrich throughout their life events as you described.
Peter Wannemacher: That’s right. And if you go to sleep at night as a bank executive comforting yourself with the idea that, “Well, don’t worry, my attrition rate hasn’t gone up,” and we see this, by the way, we talk to bank executives, they are not seeing some giant spike in attrition because of disruptors or because of niche services that are attacking specific parts of the value chain. Instead, what we’re hearing is, “No, attrition’s fine. We’re worried about our ability to achieve sustained, long-term growth.” And that’s all about the relationship.
Victor Milligan: So in the three-legged stool in the banking, there’s a concept of trust we went through, contest of brand equity, and then there’s relationship equity. And what we found in the CX index work we did in 2017 was there was a 15-point difference between the scores at the industry at large, which measures things like effectiveness, ease, emotion, and others, to what they actually get in emotion. Meaning there is an emotional gap that the customer just doesn’t seem to carry that same relationship equity. And it gets worse when you measure it against, “Does the bank reward the customer’s loyalty?” And there we saw a 30-point gap. I mean, these are early indicators that if trust is not a dynamic, and brand equity is not as strong as I’d like it to be, what I’m hoping is that the relationship carries the day, and what we’re finding is that the emotional attachment is quite limited.
Peter Wannemacher: That is absolutely right. Yeah, and, I mean, this is– what you’re describing, this idea that a company that I have a relationship with is effective, does what it needs to do well, but I don’t have any emotional connection to, you’re getting very close to the description of, basically, utility relationships. And that is, as one bank’s CMO put it to us a couple years ago, at the time, what kept him up at night was the risk of becoming a, “Dumb money pipe,” and that’s what we’re talking about here. I mean, we saw this years ago with telecom. And this, if you’ll let me take a moment, this is something financial services companies have basically never had to deal with. And that’s something that IS new. It is one of the few industries that has been pretty consistent in its business model, in its product set, and maybe, most importantly, in its role in people’s lives, for over a century. So banks, wealth management companies, insurers, just in general financial services companies, whether they’re new or traditional, will need to differentiate themselves in ways that they never have before because of everything you’re talking about.
Victor Milligan: Yeah, they’re going to have to compete on a product-by-product, experience-experience basis, and sort of on the merits of digital versus sort of the grand value of the bank itself.
Peter Wannemacher: Or if you don’t– let me just put one comment in here. There is an opportunity to intentionally and strategically move into a kind of back-end role, right? This idea of banking as a service. Something we identify in our research is this idea of an ultra-efficient utility relationship. And custodian banks kind of do this already. You look at a bank like Santander. Santander, if you talk to their executives, they pride themselves on being the most efficient bank in the world. And they’re right, by the way. They have done an incredible job of ripping out inefficiencies on the back end. That is something that every bank executive should also be considering. Yes, you need to think about your brand relationship. But there is a role to be played for banking as a service.
Victor Milligan: I think if you look at the business model, you look at the two biggest threats to the business model. It’s not extinction, it’s disintermediation and a lack of enrichment. And going back to your fork on the road, which is always a very useful analogy, which is you just don’t want to end up taking either path and becoming the unintentional utility. Like being an intentional utility, you gear your business model and you build your ecosystem accordingly. But if you didn’t know you’re being disintermediated, it’s a very dangerous place where you don’t have the requisite efficiencies in place.
Peter Wannemacher: Especially if you spent billions and billions of dollars trying to be the other type of thing.
Victor Milligan: So we look at the business model under duress by the customer behavior. And then we look at sort of the people that are coming on board, the new fintech or the new entrants in the banking sector, who are coming in not to replace the bank, not to make it extinct, but to simply add value around the banking sector.
Peter Wannemacher: Yes, that’s exactly right. To put it really bluntly, fintech doesn’t care about the banks. They care about finding ways to create value for customers so that they can make money. And you are absolutely right. What we found that they are doing, is attacking pieces of the value chain, which in turn leads to the entire value chain starting to fracture. There’s a famous blog post from a few years ago now, where someone took a big US bank, I think it was Wells Fargo but it doesn’t really matter, and showed all the services they offer on their website, right. Everything they say they sell, everything they do for you. And drew lines from every single one of those to the one, two, three, four, sometimes five or six disruptors that are eating just that little piece of the business. Many times this was repeated and used in other formats. And often it would say something like, “Death by a thousand cuts.” That is a very real potential future for financial services providers.
Victor Milligan: So there’s two parts of this puzzle as I think of fintech, and two myths that are worth talking about. The first one is that this is just millennials sort of acting out. And it’s confined or partitioned to that segment. And the second one is that there’s a lot of carnage that happened in the first stage of the fintech. And that tells us that the banking model is more durable and ultimately, this is just a flash in the pan kind of thing. And I think we’re finding both to be relatively untrue.
Peter Wannemacher: Absolutely untrue on both counts. So I’ll take them one at a time. First, when it comes to millennials and the myths around them, there’s a lot. What we’re seeing is that millennials differ from older generations in a couple of really critical ways. But as you point out, they are not just different, they are in fact kind of teachers. They are showing other generations, their parents, their grandparents, their uncles and aunts, that they can expect more.
Victor Milligan: And that’s certainly played out in the payment space especially with banking. That’s where probably it’s been most obvious.
Peter Wannemacher: It is, and I’ll say this. When we did a research study for a client, we found that around the world, Asia-Pac, Europe, US, Canada, we found that when it came to how people paid for services, goods, etc., millennials looked very much like older generations when it came to traditional payment methods. Credit card, debit card, cash, etc. What we saw as a big difference was they were far more willing to experiment with new digital companies, new digital services from existing companies. That willingness to experiment is going to have a big impact. And one more myth I’ll mention – I know we don’t have time for all of them on millennials – there’s this idea that they are not profitable. Which is an understandable. I actually am very glad that executives at banks think about that. What we’ve seen and what we know, is that millennials are soon going to be the recipients of the largest wealth transfer in history. That will have a big impact on every industry. It may have the biggest, most pronounced impact on financial services. So we already hear from big old brokerage houses that their financial advisors – the people that actually help you with your money – they’re saying that their existing clients, those that are in their 40s, 50s, 60s, older, they’re still want to come in, want to talk on the phone. Their kids want financial advice. And make no mistake, millennials desire financial advice. They actually over-index on their desire for professional financial advice. But they don’t see in-person, human interaction as essential to getting that advice. So that’s going to change things dramatically.
Victor Milligan: So one of the things that strikes me is that it might be true that there’s a natural weighting of the in-person relationship, but in this generation, there’s an appreciation for digital capabilities that’s very different than other generations. You can imagine an opportunity where if they were to provide sort of enhanced and persistent digital experiences that were high-value, that’s something that there’s a vacuum in the market on and they could fill that vacuum.
Peter Wannemacher: Absolutely. I’ll put it this way and this is not that bold a prediction. Someone will fill that vacuum. The question is, which companies will it be? And I’ll say something here about AI. There’s been a lot of conversation about AI and algorithms in banking and financial services. When you talk about algorithms, the first example many people use is Google Maps, right? Google Maps was the first time that humans, everyday Joes and Jills, started to trust an algorithm more than they trusted other people, right? I could be talking to someone. They’d say, “Oh, I can tell you how to get to Kentucky Fried Chicken.” And then you say, “No, no, I don’t need your help. I got my phone here.” Why would that not be true, down the road, for relatively straightforward financial decisions? Right? This is what robo-advisors are based on. I think there is good reason for executives of financial services companies to fear a day not too far down the road where someone in 10 years, 15 years, is walking down the road and legitimately thinks to his or herself, “What’s a bank for again?” And then, as you said earlier, they don’t cease to exist, right? They’re not Blockbuster. Instead, they are behind the scenes. They are not the company that a customer trusts to make their next financial decision.
Victor Milligan: Yeah. I think one of the common themes is that you’re looking at a pacing in the market that what is possible and what is probable is changing at a breakneck pace because it was sort of improbable that robo-advisors would be a big deal or a big threat. But that became quite probable. Now we’re in a place, is it possible that people would want to interact with a bank this way? And we’re going to quickly turn to what is probable. And banks have to respond to that, kind of speak to that.
Peter Wannemacher: That’s right. And the answer, not for everything, is a correct one. Right? It’ll be decades or maybe never before they say, “I only want to trust algorithms.” That’s irrelevant if who they start to trust is that company that provides them with that. That’s what Betterment is built around, is Betterment wants to say, “We can offer you the really easy stuff right now, and then we can help you with a hybrid approach down the road.” If Betterment and Wealthfront both fail tomorrow, no executive at a wealth management company or a bank can rest easy that night. It’ll be similar to when Napster was defeated in court. That wasn’t the end of their woes, right? That was a signal that the market was changing as we’ve talked about.
Victor Milligan: You’re also talking about a market condition where the generation that is most likely to experiment, most likely to be receptive to these kinds of offerings, and about to acquire a whole bunch of wealth is in the same segment. I mean, that’s the dangerous part, which is that’s the grand movement of money.
Peter Wannemacher: And is just entering stages of their lives, that is multiple stages, where they are most in need of financial services, products, and solutions.
Victor Milligan: It’s an interesting comment because the idea would be they may not be interested in transaction-oriented services but actually information-oriented services, things that help them handle more complex financial realities.
Peter Wannemacher: Right. Advice. Yeah, I mean, if all a bank could offer to a person who’s now starting to actually attain some wealth, get some assets, start to actually need to make more complicated decisions about their finances, if all a bank can offer them is, “Well, we can help you pay your bill pretty easily,” it’s not the end of the world, but it’s no longer sufficient. It’s necessary, but not sufficient.
Victor Milligan: So we talked a bit about changing customer. We talked a little bit about fintech and probably talked about the sort of collusion among them, which is that fermentation stage. Let’s talk about the regulators. There’s a regulation coming out in Europe, PSD2, which opens up the payment, but in a more broad context, it opens up the data. And this would change the game. This enables a different kind of fintech market. So where are we within the sort of the regulators’ effect on the market here?
Peter Wannemacher: There’s a lot of unknown, and that’s most important.
Victor Milligan: It’s the thing that businesses hate most, which is uncertainty.
Peter Wannemacher: That’s right. And it will have a big impact, we know that. So PSD2 says, “You want to start a company where you help customers with whatever their financial needs are in a particular way, and they want to let you use their data,” meaning the customer’s data. We can get into the questions about whose data it is. “Then the banks can’t stop you, right?” PSD2 right now is only in Europe, but every bank executive we speak to in US, Canada, and, frankly, around the world expects something like PSD2 to come to them. Or what we could see happen is a coalition of industry players start to really force, or at least nudge us towards collectively, a more open banking environment. And that’s going to have a big impact on the market and on every player in the market.
Victor Milligan: Yeah, we saw that. I mean, the precedent there is Telecom. When they opened up the market, it created a fundamentally different value chain. I mean, all sorts of new interests came in there and you did see this intermediation sort of move towards a utility play. And it happened quite quickly. Money will pour in as people see this opportunity exists.
Peter Wannemacher: Yeah. So the big question that comes out of all of this is, as that vacuum is being filled, what role do the big existing players want to have there? As you said, they could end up as accidental utilities. That’s really the worst case scenario. We talked about that earlier, sort of a potential dark future. I think they could instead start to take a leading role and help to design and build ecosystems of value for customers. Customers right now are starting to do that themselves. Forrester has some great research talking about customers as sort of assembling their own ecosystems. But there is a role to play for the bank, the trusted wealth management company, to help nurture, and in some cases even design and build those ecosystems.
Victor Milligan: So one of the ideas is that imagination is the exclusive terrain of the fintech, of the new interim. But to your point, banks can out-imagine the competition and imagine an ecosystem that doesn’t exist today.
Peter Wannemacher: That’s right. Forrester has written about borrowed mobile moments. They can borrow some imagination, right? They can help connect customers to fintech that are relevant to that customer’s needs. An executive who is currently with BMO, Bank of Montreal, and BMO Harris in the US, he said, “The big banks, the big brokerage firms,” and this is not a direct quote, but pretty close. “The big guys, the big incumbents, have scale but no speed. Fintech has speed but no scale.” And I’ll add one last thing he said, which was, “By the way, the big tech companies, Google, Amazon, a few others, they have both.” So you are right about this role of imagination, and I would add to that this idea of exploration. And I think this is going to be essential to success or failure, or at least I should say or utility status, unintentional utility status for bank executives and their organizations going forward. And I’ll give a quick analogy that I liked. We were talking to an executive at a bank in Asia-Pac and they were talking about small business, right? This is a very profitable and yet pretty undervalued part of financial services, especially in the banking sphere. And they recognize that they have these very valuable small business and medium-size business owners who all have an existing relationship with them. They want to have, to your point earlier, this enrichment. They need to have that long term, and yet often, a small business or a medium-size business owner will come to them and look for an additional loan. And they will do their traditional process and they’ll take a look at it and they’ll say, “Okay.” And they’ll sit them down the other side of desk and then they’ll say, “I’m sorry, you don’t qualify for this loan.” And then that was the end of the conversation. And that’s really bad customer experience, especially for an existing relationship.
So they looked around and they said, “Well, there’s a fintech player that offers loans to small and medium-size businesses. They have a different methodology for risk decisioning and a couple of other factors, and they’re going to be willing to lend to some of the customers we have who we can’t lend to.” And rather than making it simply referral marketing, right? Which would be the traditional way. They said, “Let’s think about as an ecosystem.” And what they did was they embedded that service in their digital services, in their digital experience. I think that kind of thinking where you’re saying, “Look, we have something we cannot use. There is another player who can use it, right? Xignite with market data, for example. Let’s build these ecosystems together.”
Victor Milligan: Yes. The central point is that competitively right now, the posture can’t be akin to building a moat around the castle. We’re moving to a place of strategic engagement in terms of building out these ecosystems. So as we sit here today, you can think of ecosystems as big companies building trophies, which is there’s a brand, there’s cool companies out there, and I’ll acquire them because I want the glow effect. Others build it as buffets. And the third one is, no, no, I’m intentionally using whatever imagination I have, building an ecosystem that enhances my brand, fills in some of the digital experiences I may not serve or serve as well as I’d like, whatever it might be. But it’s extremely intentional. Where are we in banking right now?
Peter Wannemacher: I’m sad to say this is one where banks are behind. Too many of them are still thinking about trophies or they’re trying to out build, right? Or what I think is probably the most common, is a very haphazard approach to building ecosystems to partnerships.
Victor Milligan: So very reactive based upon what might be happening in the market that week.
Peter Wannemacher: I think you’re actually being generous. I think it’s sometimes not even what’s happening in the market. It’s what did someone call me about? Or what did I read about in some magazine? Forrester has previously written about systems of insight, systems of engagement that complements existing systems of record, right? This is as we move into the age of the customer, this new way of thinking about things. And really, a new way of approaching your strategy. We’ve been talking about this idea of a system of exploration. And what we’re talking about is methods of rigorously, systematically identifying which areas are right for disruption and which potential partner should be evaluated and really potentially move forward with in that ecosystem. And that’s not a final definition or anything, but what we’re thinking about is designing around specific clearly articulated principles, guidelines, so that what you’re not doing is simply saying, “We know we need fintech in our ecosystem.” That’s true. Forrester wrote a report called Fintechs Belong in Your Ecosystem. We stand by that, but increasingly, leading companies are not just saying, “We know we need to partnership. Let’s embrace this. Let’s not build a moat. Let’s try to embrace the market.” They’re actually saying, “Let’s do so rigorously. Thoughtfully. Let’s lay down a set of guidelines that will help us determine where we need to focus on, who we need to partner with, and really, how to iterate from there.”
Victor Milligan: And do you see this, Peter, as sort of building the right ecosystem, or do you see this as a set of extraordinarily methodical steps to get to M&A?
Peter Wannemacher: So I don’t think it is an or. I think it’s actually both. To answer your second question, I do think there’s going to be a lot of M&A. I think that fintech is in what we would call the havoc phase. So as markets develop– I won’t bore you with the details of all three phases that we talk about, but one of them, the one we’re in now, and by the way, the one that we’ll be in for the next few years, maybe over a decade, is the havoc phase, and that means that we are going to see a ton of M&A. That M&A will happen among fintech and other new entrants, new players, as well as M&A involving incumbent firms, traditional providers.
Victor Milligan: Yeah. And it always rings true to me in the havoc market is that it’s so tough to get valuation right because you typically have a lot of overvaluation because you sort of overstate what they can really contribute to your business, ultimately, but that’s just sort of the name of the game at this point.
Peter Wannemacher: It is. I would almost say it’s borderline impossible to get correct valuations, and yet this gets into this idea of systems of exploration is understanding that that will be a problem, but hopefully a problem that you can account for and move forward not in a haphazard way. I mean, again, what I worry about is an executive who says, “I’m just going to sort of juggle. We’re going to move to Agile and don’t worry, we’re just going to play it by ear.” Being willing to explore and iterate doesn’t mean you have to be haphazard about it.
Victor Milligan: So we’ve come out of the financial crisis and we’re in a time and place right now where the existing business model is under duress, and arguably, fracturing and ultimately will fracture, and banks are at this fork in the road, as you described it. They can unintentionally become a utility and not exploit the positive changes that are underway or look the other way and say, “No, I’m going to go to strategic engagement, go to systems of exploration, and really understand how best to build out a set of experiences that really do deliver the best value and best experiences to my customers, including the millennials.” So if I’m a bank right now and I’m taking this all in, what does it mean to me? What does it mean to my decisioning over the next, let’s say, 12 months?
Peter Wannemacher: So I think the big headline is this. To achieve sustained growth going forward, you as an executive, you as a financial services company will need to differentiate, and what that means is being an actor, taking the lead, playing offense, not defense, if you will, and really embracing the fact that it is your company that has a set of advantages. Not all the advantages, as we talked about earlier. You don’t have speed the way many fintech do. You definitely don’t have the culture of innovation, but you have a lot of advantages, and if what you do is embrace exploration and measurement, it’s very easy to just iterate wildly, to semi-quote The Smiths. It is a lot harder to explore, measure, and iterate, and I think if you see your role as proactive in that way, as being an actor, and you are willing to open yourself– so I do think open banking, something we talked about earlier, will be essential to success. I don’t think it will be sufficient but it will be necessary, and that’s what I think is going to be top of mind for most leading executives and banks going forward.
Victor Milligan: Very different climate we’re entering into. Thank you for your time today, Peter.
Peter Wannemacher: Thank you very much.
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