Learning the hard way

The COVID-19 pandemic has disrupted many industries, but the best businesses are using this experience to reset and embrace technological and cultural change

Working from home, laptop on dining table

When the World Health Organisation declared the COVID-19 emergency a pandemic on March 11, 2020, all major industries – financial services being no exception – had to face one of their most serious challenges in decades. This human tragedy, which sadly spared no country, will lead to one of the worst economic downturns since the Great Depression. In fact, according to the IMF, the cumulative loss to global GDP caused by the pandemic could reach $9trn through 2020 and 2021.

At the time of writing, the crisis had started to slow down and the Principality of Monaco, where Compagnie Monégasque de Banque (CMB) is headquartered, had ended its lockdown. At this stage, the crisis is by no means over and it is too early to claim victory. Nevertheless, key lessons can already be drawn from this exceptional situation, and the measures put in place by CMB will help the bank move forward in the most efficient way possible.


Shifting priorities
In a crisis, being clear on what matters the most acts as a beacon for decision-making. When navigating uncharted waters, prioritising certain tasks and using them as a guiding light allows one to be more efficient and to ensure consistency in the actions they take. At CMB, the priority was clear from the beginning of the crisis: to protect our customers, employees and partners, while maintaining a quality of service that meets our clients’ expectations.

To that end, immediate efforts were undertaken to ensure the safety of our on-site employees, with several important measures quickly put in place. For example, we reinforced cleaning teams and deployed a dedicated cleaning agent to each site. We also disinfected offices (including air-conditioning systems) with professional sprays, and distributed wipes and hydroalcoholic gels to employees, with all client-facing staff receiving masks.

Furthermore, we started temperature testing our employees every morning and implemented a systematic work from home policy for any employee showing signs of flu and/or a temperature. Workstations are now spread out further within departments and we have covered the payment of parking, petrol and toll charges for employees who usually come to work via bus or train to help them avoid public transport.

Banking is one of the industries needed to keep economies afloat. As one of Monaco’s leading private banks, it was necessary to ensure the continuity of our operations. As with most banks, the first basic steps were reducing branch hours while ensuring ATMs remained open and had enough cash to dispense. But it also meant reviewing existing processes – making necessary updates to provide organisational resilience – and guaranteeing technological options were in place to connect the employees working at home without compromising data security. At the same time, campaigns to raise employee awareness of phishing and fraudulent attempts to exploit the health emergency were undertaken. More than ever, banks began to view cybersecurity not only as an IT issue, but also as a general business threat.

In the next few years, we believe digital disruption will intensify. In this environment, industry players with a highly traditional banking culture may struggle to adapt and establish a digital mindset. Developing and retaining the right talent to not only face these major risks but also turn them into opportunities will be absolutely necessary. The crisis has acted as an accelerator of this ongoing trend.


Going above and beyond
The COVID-19 pandemic has created strong tensions across financial markets, with worsening conditions heightening the risk of a credit crunch and increasing spreads and interest rates. The ensuing high volatility has highlighted the importance of having a banker who is genuinely attentive to client needs and competent enough to provide tailor-made advice. The core role of private bankers – to reassure and advise – appeared all the more crucial amid the uncertainty.

This COVID-19 crisis has led all businesses to assess their current capabilities and, if necessary, recalibrate for the future

Trading and hedging strategies also needed to be adapted quickly and efficiently, as a decline in prices across many asset classes increased market and counterparty credit risk. At CMB, we decided to offer tactical investments, especially on blue-chip companies that represented attractive medium-to-long-term investments.

It is important to note that in any crisis, clear communication becomes both more important and more challenging. There is a strong appetite for information – both internally and externally – and it is of crucial importance to maintain this connection between bankers and clients by using secured video conferencing tools that offer convenience while maintaining the value of face-to-face interactions.

Furthermore, the crisis highlighted the importance of being able to offer the most seamless digital experience to clients, especially through mobile and e-banking solutions. For instance, CMB Mobile, one of the most secure private banking apps on the market, meets the needs of an increasingly connected customer base. Thanks to this mobile application, the bank’s customers were able to consult their accounts in a consolidated manner, make transfers and even communicate with their private banker via dedicated messaging, all in a safe environment. The increased use of digital devices during containment also called for a reinforcement of client support to aid the use of remote banking services.


Looking to the future
Sustaining employee engagement and wellbeing is unquestionably important all year round. Employees who feel at ease are more productive and efficient, but in an unprecedented context such as this one, staff members have had to cope with a new level of stress, adapt to different ways of working and be even more agile than usual.

As far as CMB is concerned, some measures have been particularly effective in ensuring the wellbeing of our teams, both onsite and at home. First of all, we gathered feedback on employee concerns and queries via our human resources department. Second, we created a psychological support unit offering remote sessions with complete anonymity. For employees working onsite, we provided breakfast and lunch to limit the need for visiting public places, which we identified as a potential risk and source of stress. Most importantly, we worked to create an environment of dialogue between management and employees, giving regular updates via email and conference call, outlining the measures being put in place on a day-to-day basis and, above all, explaining the reasons behind each decision.

Another lesson the crisis has taught us is that when the private sector pivots to serve the greater good, its reach and power is immense. From fashion firms producing face masks to manufacturers and tech start-ups reinventing themselves to support local communities, many companies highlighted the positive role that can be played by businesses. As a key facet of the Monégasque economic fabric, CMB has an undeniable social responsibility locally. We decided, therefore, to donate 11,000 masks and launch a major fundraising campaign in favour of the Princess Grace Hospital. The sum of €100,000 ($112,095) was granted to the hospital and a total of €470,955 ($527,915) was raised. CMB believes that, in the post-pandemic world, the question of what good business looks like will be even more important.

This crisis of unprecedented scale, duration and geographic extent has led all businesses to assess their current capabilities and, if necessary, recalibrate for the future. Among other priorities, private banks should look to invest more in technology and fintech firms to deliver efficiencies and superior client experience, as well as build strong capital ratios that can face any unforeseen liquidity crunch. Most importantly, private banks should ask themselves how they can continue to embrace agility to enhance the customer experience.

It is now time for all industries to think about the changes in mentality and work habits that are likely to follow containment – notably, remote working, media-sharing platforms, video conferencing and cloud solutions. The sustained experience of social distancing and the fear of contagion has been a human experience that will change us all on an individual and collective level. Client behaviours will undoubtedly change coming out of the crisis.

There was a world before COVID-19 and there will be a new world after. Our social interactions will be redefined, but there will also be a new order in the way we work and the values we promote within organisations. The meaning of work will come under greater scrutiny and companies wishing to attract top talent will have to be very clear about the purpose of their business.

As we are given a unique opportunity to reflect and make business more culturally connected and responsive to society’s needs, we will need to learn to navigate novel ways of working and connecting with staff, clients and wider stakeholders. The door to bold new thinking, working practices and means to address client needs has been opened, and it is time for businesses to reinvent themselves for the better. We are at a critical juncture, and I am confident that the winners will be the ones who can embrace these changes.