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Banks may have stronger balance sheets than during the start of the financial crisis a decade ago, but “we’re having a hard time finding anything to get excited about in financials,” Tom Plumb, manager of the Plumb Equity Fund, told Reuters.
Nevertheless, there ongoing innovation may continue to support larger banks. McDonald argued that large-cap banks remain attractive as they have been investing in online platforms and mobile apps, which make the companies more appealing to young millennials and less dependent on more costly physical branches.
“The U.S. retail banking industry is moving from the post-crisis phase of risk management to the fintech phase of managing customer experience,” McDonald said.
For more information on the banking sector, visit our financial category.