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An IBM research report finds that while banks hope to fuel growth by expanding to new markets, more than two-thirds aren't ready to move outside their domestic market.

According to the report, "No Bank is an Island: Get Global before Globalization Gets You," almost 70 percent of banking execs say their organization doesn't work in a globally integrated way. As a result, few banks are ready to operate successfully outside their domestic markets or to compete in key emerging markets such as China, South Korea, India, Ireland, and Turkey.

"The worldwide financial system is expected to quadruple to (US) $1,300 trillion by 2025," said Shanker Ramamurthy, global industry leader, banking and financial markets, IBM Global Business Services. "Banks of all sizes are feeling the effects of globalization as rising cross-border banking M&A and the proliferation of non-bank, online and mobile banking providers increases competition for customers.

"The question is: what role will traditional banks play in a globally integrated industry? And will they be able to adapt their business models to take advantage of globalization?" he said. "We believe banks that specialize and collaborate with other players both within and outside the industry to meet specific consumer needs in various markets will be best positioned for growth."

Apparently, banks are ready for that sort of collaboration. More than half of those responding to the survey said they are looking to establish strategic relationships with service providers and vendors outside of the banking industry. And more than 40 percent said they want to collaborate more closely with their traditional rivals, other banks.

The global survey, conducted by the IBM Institute for Business Value in cooperation with the Economist Intelligence Unit, contacted more than 640 industry executives in 89 countries.

The report, the latest in a series from Institute for Business Value, caught the attention of the financial media, including the Financial Times and CNBC.