"The lowering of interest rates again by the ECB could trigger another round of changes in banking sector business models, strategy and consolidation. If the ECB sets rates even lower, the margin pressure on traditional bank businesses will finally reach real pain levels for some," he says.
It's unlikely that relief on interest-rate margins will come for some time. As long as the ECB is still fighting deflation to achieve its price stability mandate, and aspires to a 2 percent inflation goal, interest rates are set to remain on currently ultra-low levels for the next few years. It's also possible that rates are cut further at the December 3 meeting as bank president Mario Draghi and the governing council at the ECB decide "doing whatever it takes" means another round of action, in part to mitigate the anticipated tightening from Federal Reserve "lift-off".
Recent high-profile management changes at Credit Suisse, Deutsche Bank, and Barclays have signalled a desire to make progress with new business models. But in some important respects Europe's banks are lagging behind their US counterparts.
Signs of strength typified by healthy cross-border capital flows and the passage of weak to strong is lagging. Banking sector consolidation still has a way to go in the small and medium-sized space, and on a pan-European basis between large entities.
Whether they are focused on asset management, retail banking or investment banking, banks will have to think hard and act accordingly to generate revenues and profits, as non-profitable banks are no longer tolerated. As Beat Wittman sees it, "systemically relevant universal banks have so far employed the 'last man standing' strategy, however, with the 4th capital raising round some casualties might emerge."
In the "Edge of Tomorrow," Cruise destroys the alien core and, despite apparently dying in the attack, wakes the next day to a world that has changed for the better and the demons have been vanquished. Europe's bankers would like their own legacy challenges to evaporate in 2016. Only in this case, life just ain't like Hollywood.
Geoff Cutmore is co-anchor for CNBC's flagship programme Squawk Box Europe.