Industry – FinTech


At Four Quad, our mission is to make our clients industry leaders in the management and automation of financial functions and corporate financial events. Our consultants have extensive experience and are accustomed to the challenges involved in working in demanding atmospheres. We focus on serving mortgage firms, banks, corporations, insurance companies and other financial institutions, and Federal and State Government

Market participants looking to grow their businesses and maintain profit margins will need to aggressively leverage new technologies and global labor sources. Long-term growth in a market with stagnating volume is expected to be achieved through M&A activity.

The amount of capital required and the cost to originate and service mortgage loans continues to rise due to regulatory changes driven by Dodd-Frank and Basel III, and is further affected by prolonged low interest rates in the US.

Financial services players will need to harness better business models to overcome shortcomings of the past and current challenges. Four Quad draws on deep experience across industries to help financial services institutions in every region find innovative ways to optimize processes, reduce back office costs, align IT, manage risks, capture the economic benefits of building loyal customers, and plan for evolving competitive and regulatory landscapes.

We work with leading institutions in the banking and insurance sectors in all major areas, including:

  • Retail banking

  • Private banking and wealth management

  • Clients and capital markets business

  • Transaction banking

  • Asset management

  • Life and property insurance

  • Health insurance

  • Reinsurance

  • Risk, liquidity and capital management

  • Stock markets

Four Quad has deep expertise in financial services, but we also look beyond the industry and draw upon our capabilities experience. We tailor these offerings to the needs of our financial services clients to help them solve problems or pursue opportunities in many areas, including:

Challenges

  • Growth of non-bank lenders – Non-bank mortgage originations have increased dramatically over the last few years. Non-bank lenders such as Freedom Mortgage, Quicken Loans, PennyMac, Nationstar, PHH Mortgage and Loan Depot accounted for over 45% of mortgages originated in 2015, compared to 13% in 2011. There is an expectation that non-bank lending could surpass bank mortgage lending in the near term.

  • Industry consolidation through business acquisitions – High regulatory costs from new lending and servicing requirements will continue to force smaller and midsize market participants, unable to achieve economies of scale, to be takeover targets from their larger competitors to maintain profit margins

  • REIT industry consolidation – The theme of consolidation impacted the REIT space as well as traditional mortgage lenders. 2015 and 2016 saw high levels of REIT transactions, including ten deals in the first nine months of 2016. However, this consolidation trend in the REIT industry may be impacted in 2016 due to the recent Financial Industry Regulatory Authority (FINRA) regulatory scrutiny on the growing non-traded REIT market.