It’s already mid November. As we inch closer to the end of the year and begin considering our strategies for 2025, the best way for the financial services sector to prepare is to learn lessons from 2024.
This year, the industry faced some of the greatest challenges in decades:
1. Economic shifts
Interest rate hikes by the Bank of England and other central banks created waves across the industry. Banks had to rethink loan portfolios, while insurers faced increased costs and tighter margins. Asset managers struggled to adapt to market volatility, and private equity firms faced higher financing costs. The environment is fluid, and 2025 will require agile, real-time forecasting to stay ahead.
2. Regulatory pressure
In 2024, compliance became more rigorous. Here in the UK, the FCA’s heightened transparency requirements, particularly around AoV reporting for asset managers and stress testing for banks, left many firms struggling to meet demands. Reporting processes that once sufficed are now outdated, and firms are being held accountable for every action, and the same is true around the world. With more regulations on the horizon, how will financial services cope?
3. Technological lag
Conversations with clients, colleagues, and peers in the industry make one thing clear: financial institutions are still dependent on manual processes and legacy systems that can’t keep up with the demands of the modern world. Planning, forecasting, and reporting are still siloed, slow, and prone to error. If firms don’t adopt smarter, more connected technologies, they’ll be left behind.
Whether you’re in banking, insurance, asset management, or private equity, improving your planning and forecasting capabilities should be your #1 priority right now.
Banking: Adapt to a new financial landscape
In 2024, banks were under pressure to navigate rapid shifts in interest rates, changing market conditions, and regulatory oversight. Pigment enables banks to plan, forecast, and execute with confidence as we move into 2025.
- Group FP&A budgeting & forecasting
Banks need to stay agile, adjusting their forecasts across multiple business units in real time. Pigment’s group FP&A tools allow you to create dynamic budgets and forecasts that reflect real-world conditions as they evolve.
- Product-level forecasting: Mortgages, credit cards, loans, deposits
In 2024, rising rates disrupted product profitability, and banks were forced to rethink their strategies. With Pigment, you can model future scenarios for each product line, allowing you to anticipate how rate changes, new regulations, or economic shocks will impact your portfolio. - Stress testing & risk management
As regulators increase scrutiny, stress testing is no longer optional—it’s essential. Pigment gives banks the power to simulate economic shocks and stress scenarios with precision, ensuring you meet regulatory requirements and mitigate risk.
- Treasury & capital planning
Treasury management is about more than balancing books—it’s about optimising liquidity, capital reserves, and profitability. Pigment empowers your treasury team with real-time insights to plan and manage capital more effectively.
Insurance sector: Managing risk and regulatory change
The insurance industry in 2024 dealt with rising costs and shrinking margins. As inflation continues to push up claims, and regulatory changes demand more transparency, insurers need better tools to survive in 2025.
- Underwriting & premium forecasting
Inflation made pricing unpredictable, and premium forecasting became more complex. Pigment allows insurers to model premium and claims cost forecasts in real time, giving you the power to adjust to market dynamics instantly.
- Loss modelling & loss ratio analysis
Loss ratios surged in 2024 as inflation drove up claims. Pigment’s loss modelling tools give you visibility into potential risks, allowing you to adjust your pricing and risk models before it’s too late. - Workforce planning & cost allocations
With cost pressures rising, insurers must optimise resource allocation. Pigment’s workforce planning and cost allocation tools help you deploy resources where they matter most, ensuring profitability in a challenging environment.
Asset management: Managing volatility with confidence
Asset managers faced immense challenges in 2024, from market volatility to increased regulatory demands, including the FCA’s focus on assessment of value (AoV) reporting. As we enter 2025, managing these changes requires precision, speed, and transparency.
- Assets under management (AUM) roll forward & fund performance tracking
Market volatility in 2024 caused fluctuations in asset values, making it harder to forecast performance. Pigment enables asset managers to track AUM and fund performance in real time, providing the insights needed to respond to market changes.
- Fees & commissions management
As regulatory scrutiny around fees and commissions increased, asset managers had to ensure transparency and compliance. Pigment automates fee calculations and reporting, ensuring you meet regulatory expectations while maximising profitability. - AoV reporting
The FCA’s AoV reporting requirements demand that asset managers demonstrate the value provided to clients. Pigment simplifies the AoV process, ensuring you can comply with regulations while maintaining operational efficiency.
Private equity: Navigating a complex market
In 2024, private equity firms faced challenges with rising financing costs and fluctuating deal environments. As we move into 2025, the need for real-time forecasting and scenario planning is critical.
- Portfolio company valuations
Valuations are at the core of private equity. Pigment’s scenario planning tools allow you to model multiple valuation outcomes, ensuring that your portfolio is valued accurately and in real-time.
- General partner (GP) carry forecasting
Forecasting carry distributions in a volatile market is no easy task. Pigment enables you to model carry outcomes, helping you and your partners make informed decisions.
- Fund outcomes
Deal cycles are shifting, and you need visibility into fund performance. Pigment provides clear, real-time insights into fund outcomes, giving you the control you need to stay ahead of market changes.
The Pigment elevator pitch
Pigment’s value proposition revolves around three key principles:
1. Simplicity
Financial services are complex, but the tools you use shouldn’t be. Pigment simplifies everything — from real-time forecasting to regulatory reporting — so you can focus on strategy, not spreadsheets. With intuitive, user-friendly dashboards, you can access, analyse, and share insights at the speed your business demands.
2. Power
The financial world runs on data, and Pigment delivers the power to harness it. Whether you need to simulate the impact of interest rate hikes, analyse product profitability across divisions, or model capital strategies, Pigment gives you the depth and flexibility to act quickly and confidently.
3. Precision
Regulation, compliance, and risk management all demand precision. Pigment ensures that every number, forecast, and report is grounded in real-time data, ensuring compliance and reducing risk. Whether you’re meeting regulatory requirements or preparing for a board meeting, you’ll have the exact insights you need.
Next steps
2025 will hold no shortage of challenges. But with the right tools, challenges can very quickly turn into opportunities - and we’d love to help you do just that.
The best way to understand what Pigment could do for your organization specifically is by requesting a personalized demo.
