Banking is in turmoil — and it might even be in terminal decline, if a recent \nFinancial Times report is any indication. \nSigns of upheaval are everywhere. For one, profits are falling because of persistently low interest rates and increasing regulatory oversight. JPMorgan Chase, the most profitable Wall Street bank, now generates a return on equity of only 12%; Goldman Sachs, of only 7%. Before the 2008 crisis, the industry average was between 25% and 30%. \nThree hypotheses are currently being used to explain the trend. The first claims that this is just a difficult passage brought on by excessive regulation; the second, that banks are returning to normal after their pre-crisis excesses; the third, that banking is slowly dying.\n“When the history books are written, the aberration will not be the past crisis, but the 15 years running up to 2007,” says a BlackRock senior executive. In those 15 years, banks moved away from their traditional roles of deposit takers and lenders into investment banking, “casino-style” proprietary trading and financial derivatives.\nNow, the traditional bank model is being challenged by countless technology-driven developments such as peer-to-peer lending, mobile banking and financial robo-advisers. \nThe pressure is causing disruption at the top. Before the crisis, the heads at nine of the biggest global banks were traders. Today, only the chief of Goldman Sachs and HSBC come from trading. “More pedestrian retail or commercial bankers are now in vogue,” says the Times.\nBut the upheaval is greater in the lower ranks. Talented people are shying away from banking. Where one in five MBA graduates once chose banking as a career path, only one in 10 now does so. The quality of new employees has fallen, complains an executive, the best candidates opting for non-bank financial or technology companies.