Facebook, Apple, Alibaba the biggest threat to Big Four banks

Australia’s banking and financials sector is in the dog house, says the boss of ANZ’s venture capital arm.

When it comes to disrupting Australia’s banking sector, it’s not the fintechs or the neobanks that are keeping our Big Four up at night. It’s the tech giants of China and the US that pose the real threat.

That’s according to Ron Spector, the head of ANZ bank’s venture capital arm, ANZi, who has dismissed the idea that a local fintech or neobank could pose any competition to the major banks because they all faced the same economic conditions, big and small.

Speaking at the Intersekt fintech conference in Melbourne on Thursday, Spector argued that in the current low rate climate, everyone in the financials sector is facing hardship.

“The macro trends for financial services in Australia are going to shit,” Spector laid out bluntly. “All you have to look at is the return on capital, which is where the banks make their money.”

“Their cost to capital and their return on capital are almost hitting parity, which means you might as well not be a bank anymore.”

While that might seem like an opportunity for the local fintech competitors, the same economic conditions actually make it harder for the smaller players to get a foot in the door.

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Source: Facebook, Apple, Alibaba the biggest threat to Big Four banks | Finder