Technology
Deutsche Bank Opens Fintech Innovation Lab In Silicon Valley

The trend of large banking groups creating innovation labs to stay up with fintech developments continues.
Welcome to one of the latest must-have accessories in banking –
an innovation laboratory.
This week, Deutsche Bank announced it has opened an innovation
lab in the place most widely associated with new techie ideas:
California’s Silicon Valley. John Cryan, the co-chief executive
of the Frankfurt-listed bank, attended the launch event.
The lab in Palo Alto is designed to help Deutsche work out the
value of technologies arising in the region and put them to work
to make its own offerings more attractive and useful for
clients.
At a time when it is estimated that fintech business models such
as “robo-advisors” and other innovations could cost traditional
bankers their jobs and force firms to overhaul how they deal with
clients, banks have been scrambling to beat the competition by
joining the fintech revolution. For example, HSBC has launched
such an innovation lab in Singapore. Citigroup last year named
partners for a program to encourage financial technology
innovation in the Asian region: IBM and
PricewaterhouseCoopers.
According to a recent research report by Citigroup, investments
in financial technology have grown sharply in the past decade -
rising from $1.8 billion in 2010 to $19 billion in 2015 - with
more than 70 per cent of this investment focusing on the "last
mile" of user experience in the consumer space
In its new lab, Deutsche Bank is working in partnership with IBM,
which is contributing resources, expertise and relationships, the
bank said in a statement.
The opening follows the launch of innovation labs in Berlin and
London last year by the German bank.
The bank's innovation lab team has been active in Silicon Valley
since 2014, previously working from a local start-up accelerator
center.
In its Digital Disruption report, Citigroup said fintech
will squeeze some jobs in retail banking. So far, the pace of
staff reductions so far has been gradual (by around 2 per cent
per year or 11-13 per cent from peak levels pre-crisis). The bank
said it thinks there could be another 30 per cent drop in staff
between 2015 and 2025.