Traditional Banks - North Macedonia

North Macedonia

In 2024, it is projected that the net interest income in the Traditional Banks market market of North Macedonia will reach a substantial amount of US$0.73bn.
The dominance of Traditional Retail Banking is evident in this market, with a projected market volume of US$0.44bn in the same year.
Looking ahead, a steady annual growth rate of 2.60% (CAGR 2024-2029) is expected for net interest income, resulting in a market volume of US$0.83bn by 2029.
When comparing in North Macedonia to other countries globally, it is worth noting that China is set to generate the highest net interest income, amounting to US$3,869.0bn in 2024.
This highlights the significant position of China in the global market.
Traditional banks in North Macedonia are facing increased competition from digital banks, leading to a shift in customer preferences.

Key regions: Germany, United Kingdom, France, Japan, China

Definition:

The Traditional Retail and Commercial Banks market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.
The traditional banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. These banks have a long history of serving customers and have established relationships and a deep understanding of the financial needs of their communities. They offer a wide range of services and are able to provide personalized advice and support to their customers.
In this market, banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. However, they also face challenges, such as increased competition and changing customer preferences, which are driving the need for continuous improvement and adaptation.
Overall, the traditional retail and commercial banking market provides a wide range of financial services to both individuals and businesses through established, trusted channels and continues to play a vital role in the financial landscape.

Structure:

The market consists of two segments:
- The Traditional Retail Banks market refers to financial services provided to individual consumers (e.g., personal loans, savings and checking accounts, credit cards, mortgages).
- The Traditional Commercial Banks market refers to financial services provided to businesses, including small and large enterprises (loans, lines of credit, other financial products specifically designed for businesses).

The market data comprises Net Interest Income, the value of Deposits, the value of Loans, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the retail and commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.

Key players in this market are companies such as Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

Over the past few years, the Traditional Banks market in North Macedonia has shown steady growth and development, reflecting the evolving financial landscape in the country.

Customer preferences: Customers in North Macedonia are increasingly looking for traditional banks that offer a wide range of services, from basic savings and checking accounts to more sophisticated investment products. They value personalized customer service and convenient access to physical branches, while also showing a growing interest in digital banking solutions for their day-to-day transactions.

Trends in the market: One of the key trends in the Traditional Banks market in North Macedonia is the expansion of services to cater to the needs of small and medium-sized enterprises (SMEs). Traditional banks are developing specialized products and services tailored to the unique requirements of this segment, aiming to support their growth and success. Moreover, there is a noticeable trend towards sustainable and socially responsible banking practices, with traditional banks in North Macedonia increasingly incorporating environmental and social considerations into their operations.

Local special circumstances: North Macedonia's banking sector is characterized by a high degree of competition among traditional banks, leading to innovation and the introduction of new products and services to attract and retain customers. The country's relatively small market size and growing economy create opportunities for traditional banks to differentiate themselves through specialized offerings and strategic partnerships. Additionally, the regulatory environment in North Macedonia plays a significant role in shaping the operations of traditional banks, with stringent requirements aimed at ensuring financial stability and consumer protection.

Underlying macroeconomic factors: The development of the Traditional Banks market in North Macedonia is closely tied to the overall economic growth and stability of the country. Factors such as interest rates, inflation, and foreign investment inflows influence the performance of traditional banks and their ability to expand operations and increase market share. Additionally, demographic trends, such as population growth and urbanization, play a role in shaping customer preferences and the demand for banking services in North Macedonia.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.