What’s Going On In Banking? Key Takeaways

The latest edition of Cornerstone Advisors’ What’s Going On in Banking study leads with an overwhelming sense of optimism, highlighting that “optimism among bankers for the coming year is as high as it’s been in a decade.“ 

Among the 308 C-suite and senior leaders from financial institutions, 83% are “very” or “somewhat” optimistic about 2025 — with just one survey respondent that said they were “very” pessimistic. This is a significant increase over last year (60%). But, it is not all clear skies. The survey results also highlight a fair share of concerns. 

So what is going on in banking this year? And, how can financial providers set themselves up for success? Here are 3 key takeaways that stuck out to us.

1. Open Banking Opinions Vary

According to the study, financial institutions are divided about the impact of the Consumer Financial Protection Bureau’s Section 1033 rule. Forty-two percent of executives think the rule will benefit consumers but only half of these respondents (21%) think it will also benefit financial institutions. The rest of the respondents? Twenty-seven percent aren’t sure what the impact will be — and 32% are skeptical, thinking it won’t benefit consumers or financial institutions. 

Cornerstone’s report emphasizes concerns with Open Banking, stating it “places an excessive burden on individuals to manage complex data-related responsibilities.” Yes, the rule does put consumers in the driver seat. But, MX’s latest consumer research found many consumers say they want to be in control. 

Our survey of more than 1,000 consumers shows that 80% said it was important for them to know and control who has access to their financial data. And, according to the Financial Data Exchange, more than 94 million consumer accounts are now actively utilizing its FDX API for secure open finance data sharing. 

While financial institutions may be unsure about the impact of Section 1033, the impact of Open Banking is already apparent. The future of Section 1033 may be in the air under the current administration but that doesn’t mean Open Banking should slow down. 

2. Top Concerns Focus on Growth 

Last year, the top concern for both banks and credit unions was the cost of funds. Now, deposits (52% of bankers said “deposit gathering” is their top concern) and new member growth (62% of credit union executives) top the list. Increased competition from fintechs, rising rates, and shifting consumer behavior are contributing to higher customer attrition and making it harder than ever to grow deposits. 

To attract and retain deposits, banks and credit unions are prioritizing a number of strategies. When asked what is important in 2025, respondents place these strategies at the top of their list: 

• Targeted pricing strategies to retain specific clients (73% banks; 56% credit unions)
• Revised deposit product tied to pricing (45% banks; 48% credit unions)
• New deposit products tied to pricing (37% banks; 45% credit unions)
• Create or enhance reward programs (26% banks; 46% credit unions)

There is no easy button for growing deposits or new members. And, the results show that banks and credit unions are looking across a number of tactics to incentivize and retain customers and members to take action. 

3. Data Remains Key but Data Strategies Fall Short 

The report calls out that data will be critical to Gen AI initiatives, pointing back to statements in last year’s report about the need to evaluate the “quality, availability, and accessibility of specific types of data.” In this year’s report, Cornerstone asked respondents to evaluate the quality of their data strategy, governance, and use of data. Simply put: we have work to do. 

Only 6% of banks and 11% of credit unions assessed their data strategy as very effective, while how effectively they are using data is even lower. Nearly half of bank leaders said their use of data to enhance the customer experience (48%) and operational efficiency (49%) is not effective. Among credit unions, 34% say their use of data to enhance the member experience is not effective and 42% say using data to enhance operational efficiency is not effective.  

Data will be the central piece in every financial provider’s strategy in 2025. And, those who get it right will be light years ahead of the competition when it comes to meeting customer needs and growing deposits. 

These are just a few highlights from this year’s 62-page What’s Going On In Banking report from Cornerstone Advisors and Ron Shevlin. For a look at what MX believes 2025 will bring, be sure to also check out our recent 2025 Predictions Webinar.