Financial Institutions

Financial institutions encompass a diverse range of market segments, each serving distinct functions within the financial ecosystem. These segments typically include banking, insurance, asset management, brokerage, and fintech. Recent years have seen a rapid decline in the number of traditional banks, while fintech has evolved from a niche and elusive industry trend into a transformative force in the global financial landscape.

With the increasing popularity of online banking, traditional retail banks face competition from online counterparts. Online banks operate solely in digital form, offering customers easy access through apps, personalized features, and low fees. As of 2024, Europe boasted the highest number of challenger banks globally, while the Middle East and Africa had the lowest.

The world’s largest bank by market capitalization is JPMorgan Chase. The publicly listed commercial bank's market cap exceeded 490 billion U.S. dollars in 2023. The next two largest banks are Bank of America and Industrial & Commercial Bank of China, each with market capitalizations surpassing 200 billion U.S. dollars.

With the renewed interest in AI, financial institutions emerge as leaders in AI integration, exhibiting one of the highest adoption rates across industries. This is primarily attributed to the strong adoption of traditional AI, such as machine learning (ML), which has been used widely in the sector since the late 2000s. Generative AI, while currently less commonly used, will likely take hold in the industry in the coming years.