overview: wealth management


IBS Journal July – August 2015


‘There are few signs of real innovation or investment in the back office, most of the new initiatives are being delivered


by the same people and firms or are merely newer versions of the same systems. Neither of these brings real innovation


or changes to this much-needed environment.’ Steve Young, Citisoft


nels; concentration in operational hubs (the back office as a commodity); standard- isation of systems to facilitate the onboard- ing of clients, especially when acquired through acquisition or consolidation (this also aids compliance with the likes of MiFID II in Europe or FIDLEG in Switzerland); fur- ther regulatory-based change, including preparation for Common Reporting Stand- ard; and enhancement of the investment process to include the impact of taxation on performance portfolios and to industri- alise the advisory process. Big data is a phenomenon that is ban-


Global HNWI wealth in USD trillions


42 46.2 52.6 56.4 2011 2012 Source: World Wealth Report 2015 2013 2014


died around financial services as a whole, but there is no reason why it shouldn’t be applicable to wealth management, Hacking believes. ‘The focus is particularly around what is provided to the client via which channels, not just information but the con- solidation of that information in a way that is relevant to the individual client,’ he says. This is likely to further develop into using big data to effectively present, on an individual- ised basis, the information that is most likely to be interesting or pertinent to clients. ‘Innovation will also continue in both the client on-boarding (to the extent allowed within the legal/regulatory framework) and what the clients can do themselves.’ Jean-Luc Freymond, president and CEO


of Switzerland-based wealth management software provider, Sage SA, cites anoth- er consistent area of focus as the ability to equip relationship managers with portals that are accessible from tablets or other connected devices. These portals should contain all of the information they need to efficiently serve their prospects and cli- ents. ‘Simpler portals that are intended to be used directly by the clients as a self-ser- vice to make portfolio enquiries, compute performance, enquire on transactions and


22 © IBS Intelligence 2015 www.ibsintelligence.com


generate reports are also on the priori- ty list of a number of clients,’ he says. ‘The relationship manager and client portals are driven by the fact that the technology has been available for several years now and is widely used in other industries. Wealth management is merely catching up here.’ Amidst all of the emphasis on front-


end innovation, wealth managers shouldn’t forget the basics, warns Akash Anand, head of Middle East, Africa and Asia at Greece- based Profile Software. ‘Front-end tools are becoming increasingly popular and this will continue until companies are able to deliver to their clients the desired service. However, data consolidation, reporting and better analysis, to allow a focus on provid- ing a competitive investment advice, will still be important for the industry.’


Back office


In terms of the back office, Citisoft’s Young observes: ‘The back office is often run on ageing technologies and too much manual intervention. The inefficiencies here again create opportunities for new entrants to have a far more efficient business model and potentially significant cost advantages.’ He cannot see many signs of change. ‘There are few signs of real innovation or investment in the back office, most of the new initiatives are being delivered by the same people and firms or are merely newer versions of the same systems. Neither of these brings real innovation or changes to this much-needed environment.’ IPBS’s Raine agrees that the back office


is secondary at present. ‘Front-end tech- nologies are the flavour of the month. Back office technologies are generally homog- enous in terms of what they offer. CRM and delivery channels, on the other hand, are relatively new, and the end game is to bring on business for the back office to feed on.’


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