2025 is set to be a boom year for many sectors, but will private banking be one of them? What are the opportunities? Where are the risks? PBI asks the experts
Vikram Malhotra, CEO & Co-founder, 360 ONE Global
In terms of market segment trends, one key trend in 2024 has been the strong growth of the wealth management sector in the Middle East with many private banks, asset managers, and IAMs investing and expanding in the region.
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In another evolving trend throughout the year, wealth managers continued to invest in developing digital platforms to better connect with their next-gen clients and also service the entry-level high-net-worth (HNW) client segment more cost-efficiently. Steps have also been taken to integrate AI into advisory for efficiency gains initially with a larger ambition of providing customised advice at scale.
In 2024, we also saw numerous private banks and wealth managers expanding their offerings and propositions with an ESG focus. This is in response to a strong and ongoing trend of UHNW clients and family offices incorporating ESG into their overall philosophy and mandates. It is likely to gain further momentum with the ongoing inter-generational wealth transfer over the next several years.
One key trend in 2024 has been the continuing shortage of quality talent in Asia and Middle East. There has been a rise in demand for Relationship Managers (RMs) in these regions as many private banks are looking to grow their assets. With the entry of some new private banks in the Middle East market, the supply of quality talent has remained static, creating barriers to growth and straining cost-to-income ratios in the region.
Another key trend in 2024 has been the continued growth of the Independent Asset Management (IAM) sector, which has further exacerbated the talent shortage for traditional private banks. Private banks lost some high-performing RMs in 2024, who either set up their own or joined existing IAMs during the year.
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By GlobalDataForecasts anticipated for 2025 in private banking
In terms of market sector trends, the Middle East should continue to experience strong growth and lead the league tables for the net inflow of HNW and UHNW families in 2025. This growth trend is likely to be sustained beyond 2025, as wealthy families and businesses are attracted by factors such as quality of life, personal safety, political stability, rapidly maturing financial infrastructure, and a compelling tax regime. The introduction of the Golden Visa and continuing liberalisation have been game changers in accelerating millionaire migration to the UAE. Further, factors such as adverse changes in the UK tax regime will continue to support these trends in 2025.
In terms of investment preference trends, we have already seen rapid growth in private clients’ interest in alternative assets. We expect this trend to accelerate during 2025 as private clients are more open to allocating (to alternatives) with the prospect of higher returns and more liquidity. On the other hand, alternative asset managers are investing in developing products more suited to private wealth clients and expanding wealth distribution channels to tap into the faster-growing private wealth pools. We expect wealth managers to expand their alternative product suites and recommend higher allocations to alternatives in their strategic asset allocation models during 2025 in response to these structural growth drivers.
We also expect wealth managers to increase their focus on the looming inter-generational wealth transfer in 2025. This will likely be a mix of strategies including organising next-gen events, further digitalising the wealth management journey, and incorporating younger RMs in coverage teams for large UHNW families facing imminent wealth transfers to build better connectivity with the next generation.
We expect the talent shortage challenge for traditional private banks and wealth managers to continue in 2025. Some firms have responded with initiatives such as graduate recruitment programmes to infuse and train fresh talent, and to hire from mass affluent and priority banking segments to beef up their ranks, which will continue in 2025.
We expect the trend of high-performing RMs to leave private banks and join institutional-grade IAMs to continue and accelerate in 2025. The entry of very well-established institutions such as ours, brings institutional credibility, quality, transparency, and governance standards to the IAM sector. We expect to be the key beneficiary of this trend in 2025 and beyond, including when the IAM sector undergoes inevitable consolidation with the rise in compliance factors and higher market volatility potentially putting pressure on the smaller IAMs.
Kevin Barrett, Managing Director, Private and Commercial Banking, Arbuthnot Latham
In 2025, personalised, trusted guidance will be essential as clients seek clarity and confidence in their financial decisions. Private banks must prioritise being more approachable and proactive, offering expert advice and guidance to help clients navigate an increasingly complex financial landscape, especially following the Autumn Budget and the election of Donald Trump in the US.
Continuing to invest in digital infrastructure will remain essential. Clients expect seamless, frictionless experiences, whether accessing accounts, making transactions, or seeking advice. By streamlining operations digitally, private banks can make banking simpler and more convenient for clients, enhancing their overall experience. To thrive, however, we believe technology should enable deeper client relationships – helping bankers better understand the needs of their clients and how to provide the most appropriate service.
Recent industry trends have seen UK private banks offer similar wealth solutions across various client segments along with more self-service options. Whilst this approach provides cost benefits for the bank, success depends on maintaining a client-first approach.
Banks that pair digital solutions with deep expertise and personalised service will thrive and foster loyalty in a market where the number of private banking accounts has contracted. Arbuthnot Latham’s experience illustrates this balance, our commitment to personal relationships and expert advice has driven over 10% growth in client numbers since 2023, and a net promoter score over 71.
Jean-Baptiste Graftieaux, CEO, Bitstamp
2024 was a pivotal year for cryptocurrency. Strengthened regulations further integrated crypto into mainstream finance, while a focus on compliance and security bolstered trust in the sector.
Bitcoin had an extraordinary year, with its price soaring by approximately 130%, driven by enhanced regulation and strong support from the incoming U.S. administration. Crossing the $100,000 mark in December was a landmark moment.
Trust in crypto grew in 2024 after the sector put right some historical wrongs. Bitstamp was one of the exchanges to help restore assets to those who lost out from the Mt. Gox collapse a decade ago.
Exchange-traded funds (ETFs) emerged as a major trend, opening crypto markets to a wider range of investors. Additionally, Bitstamp secured its landmark MiFID MTF licence in October, which will enable us to offer crypto derivatives to institutional and retail customers—further highlighting the evolution of the industry.
Global regulatory frameworks are adapting to support crypto, solidifying its position as a cornerstone of the decentralised financial system and making crypto investment more accessible and flexible.
We’re excited about the renewed confidence in cryptocurrency and the growing recognition of its benefits by world leaders.
In 2025, cryptocurrencies are poised to strengthen their place in the global financial system. While the exuberance of late 2024 may cool, the sector’s fundamentals remain robust.
The incoming US administration’s favourable stance on crypto, coupled with expected macroeconomic improvements, could boost digital asset values while preserving their appeal as an inflation hedge.
ETFs were a game-changer in 2024, making crypto investment more accessible to both retail and institutional investors. This trend will likely continue, supported by new U.S. regulations and the rollout of MiCA in Europe, which aims to increase market transparency.
As crypto gains recognition as a versatile asset class, institutional demand for indirect investment products will grow. Bitstamp’s dedication to safety, security, and compliance positions us to serve both retail and institutional customers effectively.
We look forward to building on this momentum, fostering trust, and championing innovation as the sector continues to evolve.
Tony Whincup, Head of Investment Specialists, Close Brothers Asset Management
Artificial Intelligence (AI), interest rates, Trump: with hindsight just a handful of words may arguably sum up markets in 2024. True, the horrors of war in Ukraine and the Middle East were writ large in the news and the human cost of so many lives ended and upended – disturbing and brutal – may impact markets yet. True, Labour’s first Budget in 14 years will be consequential for businesses and individuals alike, but markets greeted fiscal plans with relative equanimity. Of all, Trump 2.0 suggests we are entering a new geo-political paradigm with far-reaching consequences until 2029 and beyond.
As 2024 unfolded, it became more likely that the US would avoid a recession. A so-called soft-landing scenario in which policymakers tame inflation with higher interest rates without destroying jobs and crashing the economy appears to be playing out. In major economies (excluding Japan), inflation has cooled and central banks are responding by relenting on interest rates. All major central banks have now cut interest rates at least once. We’ve likely hit peak rates but the journey down won’t be smooth: data-dependent policymakers and frequent data revisions will jolt markets in 2025 as they did this year.
In 2024, the world’s second largest economy, China, left investors guessing what it might do to revive itself. In October, policymakers eventually unleashed a package of measures over coming years potentially totalling 10 trillion yuan (~$1.4trn) to resuscitate the property sector, support equity markets and restore confidence to both domestic and international investors. Investors responded in particular by pumping an unprecedented amount of cash into Chinese equities. This stimulus may be consequential and successful. China is grappling with a sensitive transition from an export-lead economy to a more domestically-focused one with unhelpful demographics, and will probably undershoot its “around 5%” GDP growth target for 2024.
Global GDP growth has been acceptable, if muted. We expect around 3.2% GDP growth in 2024 and 2025 with a resilient US (+2.1%), better-than-excepted UK (+1.4%) and Eurozone (+1.3%) all growing in 2025. Unemployment hovers around 4% in the US and the UK and around 6.3% in the Eurozone. Inflation (as measured by the Consumer Prices Indices or CPI) is forecast to be between 2.0% and % in these economies in the near[1]term, with ongoing concerns for Russian gas supplies feeding volatility in the Eurozone. Consumer confidence has ebbed with local factors such as the UK’s Autumn Budget and US election delivering mixed surveys – but reality is likely better than sentiment.
In Europe, Germany’s travails continued with the collapse in November of its three-party coalition imperilling Chancellor Olaf Scholz. Germany’s economic malaise sees it teeter towards recession. After a euphoric Olympics, France’s budget drama toppled Prime Minister Barnier’s government and infected markets: at around 0.80%, the spread (or difference) in yield between France and Germany borrowing 10-year money stretched to its widest level since 2012. So-called ‘bond-vigilantes’ – bond traders who sell government debt in response to fiscal policies, thereby driving its yield up – are clearly signalling that to lend to France they want to be compensated for taking additional risk. With no election possible in France until July 2025, expect more inertia and realpolitik: plus ça change.
The advance of the far-right in France, Germany and Austria will shape the EU narrative on key issues including immigration, border control and jobs. Scapegoat politics will reassert itself. For the UK, a new Labour government appears keen-ish for a rapprochement of sorts with the EU. Time will tell whether a potential Swiss-style EU-UK relationship will ease friction and reap economic benefits.
Trade wars were a constant drumbeat in 2024. Canada, the US and Eurozone slapped punitive tariffs on heavily subsidised Chinese electric vehicle (EV) imports of up to 100%. Critical goods in sensitive industries – including active pharmaceutical ingredients, lithium and some minerals – face restrictions as governments pressure and incentivise companies to on-shore, friend-shore and near-shore. President Trump will arguably accelerate this from 2025.
Despite this tricky backdrop, major equity markets – including India’s Sensex, Japan’s Nikkei 225, the US’s S&P500 and the FTSE100 – made all-time highs in 2024.
In the US, the fortunes of a handful of tech-titans – including Microsoft, Apple, Amazon, Alphabet and Nvidia – continued to support markets in 2024, although the outsize weights of these mega-caps caused widespread volatility.
Discerning between AI winners and also-rans remains a key theme into 2025. Certainly, not owning AI-exposed companies in 2024 has required courage by investment managers, whilst excitable investors have pushed many names to stretched valuations only to punish even mildly disappointing results. Some two years into a bull market since the S&P500 last troughed in October 2022, more sectors will likely need to participate to sustain the current rally into 2025.
Other breakthroughs also captured investors’ imaginations in 2024. We watch the efficacy of novel weight loss drugs (which influence insulin and glucose production, digestion and appetite) with excitement and caution. And we’re mindful of old-fashioned assets quietly breaking all-time highs: gold briefly surpassed $2,700 per ounce on geo-political risk, central bank and retail buying, and less competition from yield-producing assets like cash as interest rates fall. Fixed income has been quietly delivering an attractive yield from quality and mostly short[1]dated maturities. And the variety of alternatives means there are many compelling contenders for a multi-asset portfolio.
Merlin Piscitelli, EMEA Chief Revenue Officer, Datasite
As the year ends and the beginning of a new year approaches, the mergers and acquisitions (M&A) industry is preparing for a shift. From a year filled with geopolitical tensions, technology disruption and multiple national elections, the stage is being set for a more positive 2025 that includes cautious optimism, opportunity and potential.
2024: A year of measured momentum
2024 was anything but a typical M&A year. It included political pivots, as nearly two billion had the opportunity to vote in major national elections, major unrest in Europe and the Middle East, steep financing costs and inflation. As a result, it was a good, but not great, M&A year.
Macroeconomic trends and uncertainty over election outcomes and impacts combined to dampen M&A in the first half of the year. In fact, a staggering 81% of global dealmakers surveyed by Datasite, which facilitates approximately 15,000 new global deals annually, expressed significant concerns about the impact of elections on activity over the next 12 months.
Given this, dealmakers shifted their 2024 strategies to a more measured approach, that included strategic pauses and selective activity. In fact, global M&A hold rates on Datasite climbed 25% in 2024, as election-driven uncertainties triggered dealmakers to hit the brakes. More than four in ten (45%) M&A professionals also extended transaction timelines, reflecting the heightened uncertainty surrounding national elections and potential regulatory and trade policy changes.
Still, despite these pauses and extensions, the UK proved to be a standout performer. M&A activity involving UK companies surged 57% to $306bn, compared to the same period last year, outpacing major European counterparts like Germany ($143bn) France ($142bn) and Italy ($91bn).
Going into 2025, momentum is likely to continue as election-driven uncertainty dissipates globally. In fact, global deal kick-offs on Datasite jumped 44% in the two weeks after the conclusion of US elections, compared to the same time a year ago.
Sectoral opportunities
The deal pipeline is healthy, especially within technology, media and telecommunications (TMT) and healthcare and life sciences, as a result of post-election regulatory clarity, tech innovation and significant medtech investments.
Additionally, dealmakers are eyeing the potential for strategic investments within the AI and cybersecurity industries and consumer M&A is gaining traction, buoyed by wellness interest and e-commerce growth. Business services, including professional services also present another compelling investment opportunity as companies able to navigate complex operational challenges are potentially attractive acquisition targets for larger enterprises seeking to enhance their offerings.
Private equity firms are also investing in mid-market businesses that offer greater agility, clearer paths to value creation and more straightforward integration processes. Some PE investors have already used their playbooks to unlock potential in these businesses, making them prime opportunities for targeted investments into 2025.
Emerging regional markets
Dealmaking in 2025 is expected to be more diverse geographically too. Emerging markets in Eastern Europe, the Middle East, especially Turkey, are becoming increasingly attractive for dealmakers seeking undervalued assets and fresh market points.
These markets offer unique advantages, with less competition, potentially more favourable regulatory environments and opportunities for strategic positioning that aren’t available in more saturated markets.
Forget the spreadsheets and strategies, dealmakers are driving M&A in 2025
Another emerging trend in 2025 is the importance of human involvement in M&A. Turns out, deal failures aren’t always because of the numbers or market conditions. In fact, 46% of global dealmakers said unrealistic expectations around resourcing was the biggest cause of deal failures in the last 12 months. This was followed by 34% who said overconfidence in market knowledge, ego clashes and lack of initiative thinking.
That’s why technology, especially artificial intelligence (AI), is crucial, particularly in deal management. AI is already significantly reshaping the way deals are done, from automating repetitive tasks and powering data analysis, to easing processes across all phases of the deal, including pipeline management, outreach, preparation, and due diligence. In fact, 66% of global dealmakers globally said exploring the use of new AI tools is their top operational focus area next year, while 42% view increased productivity as a primary benefit of generative AI in their business.
So, while dealmakers may be cautious about the broader economic and political environment, they are open to how technology can support them in navigating 2025, and how they can gain a competitive edge longer-term.
An optimistic outlook for private banking and 2025
Looking ahead, pent up demand on both sides is likely to invigorate M&A, as dealmakers now have somewhat more clarity on how elections will impact regulation and trade policies to create and manage healthy pipelines.
Looking ahead, assets are primed to hit the market and significant capital is ready to be deployed. For deal-ready M&A professionals that are able to navigate bandwidth constraints and the complex deal landscape effectively, the year ahead looks brighter. Additionally, since the conclusion of US elections, deal kick-offs jumped 44%, indicating a positive shift and reinvigorated M&A after a period of uncertainty.
Scott Dawson, CEO, DECTA
Another year, another prediction about open banking. While open banking has been on the forefront of fintech conversation since 2018, I don’t think that it’s controversial to say that it hasn’t been as successful as its creators would have hoped. Many people either haven’t heard the term or have negative perceptions of it (‘I’m not going to open my bank account up to just anyone!’), but more importantly many people are using it without even knowing. A full half of open banking users shows that Open Banking is in fact quite popular – so long as you don’t call it Open Banking.
It seems that while there is an appetite for the things that open banking can do, there is little appetite for the term itself. It might even be dissuading potential users from engaging in what should be a vibrant ecosystem of services. People don’t need another technology in their lives; they need solutions to real problems, and it seems that many are using open banking as just that.
What does this mean for the FinTech industry? It means that the general public don’t always get excited about the things we get excited about, and that’s okay. They don’t need to know that the app they use to apply for credit or manage their finances is part of a larger ecosystem of services created by the Payment Services Directive 2 regulatory framework, and we as an industry don’t need to spend time and funds promoting open banking as a concept, or even talking about it, when they can be promoting the individual services that open banking enables.
One of the biggest stories of the previous months, the US election, has certainly generated its share of headlines and analysis, and the FinTech industry has joined the hype train. Frankly, a lot of what we’re seeing out of the US right now seems like it’ll be seriously watered down before they come into contact with reality: tariffs that would vastly increase consumer prices, a promise to reduce the size of the federal government that would leave millions jobless and constant reference to trendy topics like AI and cryptocurrency that may have little to no real world implications.
What does this mean for us on this side of the Atlantic. Honestly, not much. Despite Brexit, the UK is always much closer to Europe in regulatory terms (as we’ll see from PSD3), so a flurry of red tape cutting in the US isn’t going to affect our own legislation. The UK’s economy is interlinked heavily with the US’s, that’s true, but not to the extent that major up or downswings will move our own economy too much. The only real problems – for SMEs at least – will come if Trump’s tariffs are enacted as he said they would be: 10% import tariffs on all foreign goods, including those from the UK would inevitably reduce them, but by how much we can’t tell.
It’s natural to be concerned about what a geopolitical six-hundred-pound gorilla like the US is doing, but we should be sober-minded about the level to which our economies are really intertwined – it’s likely the case that whatever happens there isn’t going to be the end of the world.
PSD3 is coming
Open Banking came out of PSD2, the result of an attempt to level the playing field between payment service providers by giving them access to account information. There is still plenty for the payment service regulators to do, especially when it comes to combatting fraud and expanding the capabilities of Open Banking, and PSD3 is going to arrive in 2026. With the final version of PSD3 expected by the end of 2024 or at most early 2025 we will have a more concrete vision of what to expect, but the core concepts are already being discussed. n a compliance sense, regulations and directives have key differences: a directive sets out a goal for EU member states to achieve whereas a regulation is binding. The UK agreed to be part of the original PSD1 and PSD2, but is under no obligation to adopt PSD3 – it’s likely that it will do so just to keep things simple when doing business in Europe at a time when Brexit has over-complicated it, but we don’t know if the UK will accept all, some or none of the directives.
It is likely that PSD3 will be a continuation of PSD2 instead of a set of entirely new ideas, as PSD2 had been. There will likely be further streamlining of authentication for Open Banking, extended IBAN checks that will make credit transfers safer and a clearer framework for e-money. Ideally, fraud countermeasures will do something about APP fraud, which is a major cause of fraud in the UK and across Europe, but this may not fall into the remit of the directive.
Eric Noll, CEO, FusionIQ
2024 Year in Review: In 2024, significant strides were made in wealthtech solutions for retail banks: cloud-native platforms continued to reshape the financial services sector, delivering reduced operational costs and greater flexibility, enabling institutions such as banks and credit unions to better meet evolving consumer demands. These turnkey solutions allowed seamless onboarding of digital investment services and set the stage for holistic financial ecosystems. This year solidified the foundation for democratised, technology-driven wealth management, paving the way for broader adoption and deeper integration across platforms.
The past year also witnessed significant strides in integrated finance, with a growing focus on greater access to wealth management while enhancing customer experiences. Digital wallets emerged as transformative platforms, evolving beyond payments to include integrated wealth management tools, thereby broadening access to investment opportunities for a wider audience. By merging these functionalities, such platforms empower users to manage investments, savings, and financial growth seamlessly, expanding financial access once controlled by large institutions. Currently at an early stage, these tools are expected to reach more consumers: 65% of adults in the U.S. use a digital wallet at least once a month, with 53% using it more frequently than traditional payment methods.
2025 Forecast: Looking ahead, 2025 will be a transformative year for wealth democratisation. Accelerated by turnkey wealth-as-a-service platforms, more consumers will access sophisticated investment tools through financial institutions and digital wallets. Cloud-native technologies will continue driving this shift, offering scalability, flexibility, and enhanced customer experiences. Seamless integration will redefine wealth management’s reach, enabling financial institutions, including community banks and credit unions to adopt digital investment services. This reimagining of “share of wallet” will expand market reach and redefine consumer expectations around accessibility and convenience. Lower costs and enhanced accessibility will allow more users, including gig workers and those previously underserved by traditional banks, to invest and grow wealth.
As consumer preferences shift towards simplicity and immediacy, 2025 promises a more inclusive and technology-driven financial ecosystem. Ultimately, this evolution reflects a larger trend toward meeting investors where they are, making wealth management a universal possibility rather than a privilege.’
Carlos Kazuo Missao, Head of Innovation, US, GFT
Open banking will make it easier for consumers to select the banks and financial providers that best align with their personal expectations. As this happens, banks will enter a new race to improve their digital experiences, security, and product offerings in order to maintain their customers’ loyalty for the long run.
Open banking regulations are maturing around the world, making consumers the real owners of their data and enabling them to transfer it between financial organisations in a safe way. This streamlined process removes many of the pain points that have traditionally come with opening a new banking, savings or credit account, onboarding a lending process, or acquiring goods.
For consumers, this means the ability to switch providers at the click of a button. For banks, it means increased competition. But it also gives them new insight into the types of products and services customers are looking for from other providers. Based on what they learn—in some cases, the hard way—open banking will be key to developing bespoke offerings that set banks up to attract new customers and retain existing ones for the long term.”
Emma Wall, head of platform investments, Hargreaves Lansdown
Expect volatility to reign in 2025 and for equities and bonds to be jumpy over the next 12 months. Nothing new there, markets and yields have bounced about in 2024, sensitive to macroeconomic and political shocks. But, while it can be difficult to manage the emotional rollercoaster of a volatile investment market, it also creates opportunities for nimble investors. Heading into the new year, there are three investments we see as the most compelling. However, as always with investing, these should be part of a portfolio that is well diversified across regions and asset classes.
We’re bullish on bonds – although investors should manage their expectations on rate cuts. This is a higher for longer era. Both the Federal Reserve central bank in the US and the Bank of England in the UK have warned that cuts will be slow to come and cautiously applied. Inflation is after all not conquered yet, and a number of incoming US President Donald Trump’s policies are likely to be inflationary too.
But with the 10-year Gilt and US Treasury yields both still above 4%, bonds are still as attractive to us as they were earlier in 2024. Taking a long-term view, yields could fall to below 4% in future. By looking at bonds now, there is potential for capital gains in the future, as well as being rewarded with inflation-beating income in the near term, and the potential to diversify portfolios.
The 47th President of the United States’ impact on the US stock market could be positive for smaller companies. On the campaign trail, Trump mooted a blanket 20% tariff on all imports into the US. Trade tariffs favour domestic businesses over international conglomerates, and smaller companies are usually more domestically focused, although investing in them carries more risk.
Trump has also proposed cuts to cut corporate taxes, which is positive for companies’ earnings – and therefore could be beneficial to stock prices.
Infrastructure and renewables
While inflation and interest rates have proved headwinds for infrastructure, the macro-environment is – slowly – changing. Falling inflation and interest rate cuts historically have been good for the sector. Add to that significant investment promised in the UK Budget in October and the outlook is brighter than it has been in some time. Both infrastructure and renewable energy offer investors potential for income and growth and can add good diversification to a portfolio that already owns stocks and bonds.
Finally, a quick word on gold. While we don’t think it makes great gains this year, we do think it will hold its value and provide a useful diversifier in the face of both inflation and – sadly likely – continued geopolitical shocks.
Özge Doğan, Founder and CEO, Karman Beyond
The Great Wealth Transfer is well underway, with all forecasts expecting as much as $80 trillion to be transferred, globally, over the next 20-25 years. A new era of family leaders is set to shake up traditional ideologies, strategic approaches and ways of working across the wealth management industry.
Understanding the trends and nuances of the Next Generation will be critical in 2025 – yet most of the wealth sector are lagging in their efforts. As the Next Generation’s holdings of assets and capital crystallise – wealth management strategies will need to align with new clients’ needs and their increasing influence. Next Generation investment philosophies are different. There is greater interest in impact, incorporating ESG principles, and exploring alternative investment opportunities in the likes of private equity and real estate.
Any wealth management entity only just starting to adapt to working with Next Gens is too late. Next Gens already influence decisions as the family business landscape changes rapidly, especially in Türkiye.
Next Gens’ trust needs to be earned, but yesterday’s methods are not the way to do it. The Next Generation wants to work with advisors keeping pace with change and aligned with new trends – which is sparking a further shift to Family Offices. With Family Office numbers proliferating globally, this transition is well underway and will intensify in 2025. Emerging family leaders are seeking holistic service providers with their best, long-term interests at heart.
For families managing their wealth, a clear division of roles between asset managers and Family Offices is needed. Private banks excel in asset management – while Family Offices specialise in understanding and managing family dynamics – and they should remain focused on this core function. Adoption of this model will give Next Gens the best opportunity to manage and discover their wealth’s real potential and their exciting future ahead.
Tim Bennett, Head of Education, Killik & Co
Looking ahead to 2025, there are reasons to be quietly confident that inflation may stay tamed. That is certainly what the Bank of England is relying on if it is to cut rates again next year.
Firstly, supply chains have been stabilising across much of the world following the huge disruption caused by the pandemic and associated lock downs. Next, economies are now adapting to the devastating consequences of the wars in Ukraine and the Middle East. Thirdly, consumers are under pressure here in particular and are naturally reigning in spending as a result.
That all said, there are forces at work that could upset such a rosy view of the world.
Although it is not yet clear how widely the rumoured US tariffs may be imposed by Donald Trump, the risk of an escalating trade war with China, should Beijing respond in kind, is real and would be inflationary.
Meanwhile, tax rises in the UK are coming in all the time, with a substantial change to the employer’s national insurance rate due in April 2025. Many businesses might try to pass this onto customers by raising prices.
Then there is government borrowing and spending plans, which could prove inflationary once they kick in.
Eitan Katz, CEO, Kima Finance
The financial services landscape in 2025 is poised for significant shifts as decentralised finance (DeFi) and traditional finance (TradFi) continue to converge.
The increasing adoption of blockchain technology and tokenisation is reshaping how private banking markets operate. Tokenised assets—ranging from equities to real estate—are emerging as a transformative force, offering enhanced liquidity and transparency while lowering barriers to entry for private banking clients. This trend could accelerate as banks seek new ways to engage younger, tech-savvy high-net-worth individuals (HNWIs) demanding greater control and innovation in wealth management.
However, challenges remain. While regulatory clarity around digital assets is improving, the implementation of global frameworks is far from seamless. Private banks face the dual task of integrating cutting-edge technology while maintaining robust compliance in an evolving regulatory environment. Those that succeed will likely set themselves apart as leaders in the new financial paradigm.
Another crucial factor is interoperability. As blockchain networks proliferate, the ability to connect decentralised ecosystems with centralised platforms is becoming a cornerstone of innovation. For private banks, leveraging interoperable protocols could unlock unprecedented efficiencies, enabling them to streamline cross-border payments, facilitate real-world asset transactions, and offer diversified portfolios that span both fiat and crypto assets.
Sustainability will also play a key role in shaping private banking trends. ESG considerations are no longer optional for HNWIs, particularly among younger generations. Offering blockchain-based solutions that align with these values will position private banks as forward-thinking and responsive to their clients’ evolving priorities.
The road ahead for private banking is one of both challenge and opportunity. By embracing decentralised technologies and prioritising interoperability, private banks can position themselves at the forefront of financial innovation in 2025 and beyond. At Kima, we see this convergence as a defining moment—one that offers the chance to unify the financial ecosystem for a more efficient and inclusive future.
Julia Khandoshko, CEO, Mind Money
The first half of 2025 will be shaped by two major factors. The first is the start of Donald Trump’s new presidential term. It’s been a long time since we’ve seen such anticipation surrounding the stock market, industries, and economic policies as we do now, ahead of his inauguration. Radical changes in fiscal policy have already been announced, including the creation of a special department to tackle the budget deficit.
Additionally, there is a risk of a large-scale trade war, which this time might not only involve the U.S. and China but also significantly impact Europe. How aggressively Trump will act in the first six months will set the tone for the economy in the years to come.
The second key factor is the shift towards an ultra-loose monetary policy. The first half of 2025 could mark the beginning of an era of low interest rates. Current economic indicators such as inflation, unemployment, and economic growth are relevant primarily in terms of their influence on the Fed’s decisions. Whether they provide Jerome Powell with arguments for aggressively cutting rates or holding back such moves will be crucial for the market’s future trajectory.
As for investment sectors, it’s important to avoid betting against the market. 2025 is set to be a unique year: on the one hand, the trends in artificial intelligence and biotechnology will continue, and those who fail to invest in these areas risk being left behind. On the other hand, traditional sectors like resource extraction and banking are also expected to perform well and could deliver surprising results for investors.
When it comes to technologies, they undoubtedly play a crucial role, but a balanced approach is necessary. AI is a promising investment area, but relying on it, for example, as a tool for automated portfolio management or robo-advising, may not be wise. Investing in companies developing advanced technologies is one thing but expecting them to deliver revolutionary profits instantly is another. So, to say, to invest in new technologies, but not with their help.
Emerging markets also deserve special attention in 2025 as an interesting investment sector, though they have evolved significantly compared to 2015. The upcoming year is not the time to simply talk about diversification—it’s time to actually implement it. Diversification across countries, asset types, and investment timeframes will be essential. Therefore, investors need to reassess risk profiles and align them with the realities of these markets today.
Summing up, in 2025, investors should focus on three key strategies: monitoring the impact of political and economic changes on markets, investing in promising sectors such as AI and biotechnology without excessive dependence on technology, and actively diversifying the portfolio with traditional industries and new opportunities in emerging markets.
Jeff Brummette, Chief Investment Officer, Oakglen Wealth
As reactions to the US election continue to roll in, there has not yet been a negative market reaction to the proposed tariffs or mass deportation of undocumented immigrants announced by President-elect Trump. Tariffs can be implemented at pace so an impact could be felt by the end of the first quarter, while tax policies would be unlikely to occur until late in 2025.
US markets have outperformed the rest of the world – even when excluding the ‘Magnificent 7’ stocks – with the outperformance accelerating in November. It is too early to pinpoint which factors, if any, might stop or reverse this sustained outperformance of US assets.
President-elect Trump’s economic team have made remarks which suggest the new administration would not necessarily increase the US budget deficit. This has encouraged a decline in longer-term yields. Across the Atlantic, European yields have seen a dip, caused by economic weakness in Germany. Meanwhile, UK yields retreated from recent highs due to favourable inflation data. The global investment environment remains positive, bolstered by stable economic growth and moderating inflation.
Both the US Federal Reserve and the Bank of England lowered their policy rates in November, with further cuts possible so long as inflation remains curbed. Similarly, the European Central Bank has signalled its intention to further reduce interest rates, showing potential for more moderate monetary policy throughout next year. Energy prices continue to decline and labour markets remain tight, which as a combination supports business and household spending and could lead to further positive performance in risk assets. Fixed income also generated positive returns in November, after poor returns in the previous two months.
In response to the Trump presidential win, we have added exposure to US small cap stocks and increased our holdings in US financials – two areas which are poised to benefit from lower taxes and regulatory reforms. The US energy sector could also benefit from a more relaxed regulatory environment. We naturally anticipate greater volatility next year due to President-elect Trump’s unpredictable leadership style. Nonetheless, we remain optimistic.
Guy Harrison, CEO, Quantios
While 83% of firms agree that digital transformation is vital for staying competitive, many are still held back by outdated processes, immediate issues and infrastructure challenges.
These barriers often lead to a cycle of reactive “fire-fighting,” where immediate operational issues overshadow long-term strategic goals. As 2025 brings even tougher market conditions, underinvestment in technology risks exacerbating bottlenecks and tightening budgets further, leading to outdated systems staying in place.
The firms that’ll come out on top in 2025 will be those that shift their focus from short-term fixes to creating scalable, adaptable digital systems. Investments in cloud-based solutions and Software-as-a-Service (SaaS) platforms will prove to be particularly impactful, as they offer flexibility, scalability and long-term cost efficiency for those looking to remain competitive.
Leo Labeis, CEO, REGnosys
2025 will be a year of continued reporting challenges and subsequent growth of the RegTech industry – predicted to be worth $85bn by 2032 – as financial firms look to technology to stay ahead of regulatory changes.
This year saw the implementation of version 3.2 of the CFTC Rewrite, EMIR Refit (both the European and UK versions), JSFA, MAS and ASIC. This has come with challenges from an implementation perspective, with the EU Refit being particularly difficult for market participants and trade repositories.
However, these changes are broadly welcome as they will accelerate the pace of data harmonisation across jurisdictions. Next year will see a continuation of these reforms with Canada and Hong Kong scheduled in the next 12 months. Eyes are also on the U.S. with the new administration’s potential to adopt a new regulatory agenda, and Europe with several consultations regarding MiFID and SFTR.
Nicholas Hyett, Investment Manager, Wealth Club
2024 was a year of significant political risks, with elections taking place around the world. 2025 is the year we see how those political risks play out in markets.
The incoming US administration is set to cut taxes and increases tariffs. Both have the potential to push up prices and kick start another round of inflation. An inflationary surprise could cause an upset when markets are pricing in a gradual easing of monetary policy. It also highlights likely tensions between the Trump White House and Federal Reserve – with fiscal loosening potentially undermining the Fed’s planned rate cuts.
The potential for significant disruption to international trade from tariffs, institutional infighting, and interest rates getting stuck at a higher level, could lead to volatility in currency markets and a repricing in US assets – ending the period of US exceptionalism we’ve seen recently.
All that makes a global portfolio essential. It’s impossible to know which way the macro-economic winds are blowing, but those with a diversified portfolio will be best placed to weather any storms.
On the plus side, the Biden administration was perceived as a barrier to corporate activity by many and the change of President could pave the way for an uptick in dealmaking in 2025. The new administration is likely to usher in an era of deregulation and lower corporate taxes. For a corporate America in good health and with substantial dry powder, that would create the conditions for a return of animal spirits.
This leads us to the final theme likely to define 2025 and beyond – the increasing importance of private markets for private investors. There is an ongoing shift in capital markets away from public markets and towards private. Companies are choosing to stay private for longer or not list at all. Founders of listed firms are increasingly willing to be taken private with private equity now seen as a valuable source of capital to accelerate growth and add value. Institutional investors have long recognised that they cannot afford to ignore private markets – in 2025 that realisation will hit the broader investment market.
Joey Garcia, Director and Head of Public Affairs, Policy, Regulatory Affairs, Xapo Bank
For many tech-based, fintech, or blockchain native businesses next year MiCA will represent quite a significant step into the world of regulation, and high regulatory standards being applied to a largely nascent space. However, they will also need to understand the implications of non-compliance. Soon after the 30th of December, I expect authorities will want to show the industry their capacity to take decisive measures against what would then be the unlawful provision of services. These measures may look like sanctions, operational restrictions, or administrative penalties as high as 700,000 euros for individuals and 5,000,000 for legal entities. Undoubtedly, any regulation prioritising consumer protection and market integrity, applied to a developing industry, will likely prompt actions to establish clear standards.
While MiCA is frequently portrayed as the financial regulatory equivalent of GDPR, setting a benchmark for the industry, I don’t fully agree with that characterisation. That said, it’s likely to be a significant reference point for countries developing their own frameworks. What will be interesting is observing whether President Trump will meet his goal of introducing the US’ first regulatory framework in his first 180 days (which feels unfeasible), as he pledged during his speech at BTC Nashville. If this does happen, it’s likely that existing frameworks, including MiCA, will be considered as part of the development process.
The UK has the opportunity to leverage its ‘second mover advantage’ to create a more balanced regulatory framework through collaboration with industry stakeholders and participants. The balance of being able to foster and support innovation, while creating a secure environment for inexperienced consumers can be a very fine line.
