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Refinitiv survey reveals wealth transfer is top concern for wealth managers globally


The key trends shaping today’s wealth management industry include: data and analytics, digitalisation, customisation, operational efficiency and client relationships, according to a new report from Refinitiv, ‘Transformation of Wealth Management – Five Trends for 2020 and Beyond’, which has been produced in collaboration with Aite Group. 

In order to better understand how wealth managers are managing the trends and developments that are set to impact them over the next few years, Refinitiv and Aite Group conducted interviews with business leaders across a range of wealth management firms in The Americas, Europe and Asia.

Key findings of the survey revealed that 100 per cent of wealth management firms consider wealth transfer one of their top three concerns, while 86 per cent consider servicing clients as a highly important digital capability to acquire.

Some 46 per cent only partly satisfied or not at all satisfied with their current digital offerings and 90 per cent have recently or are currently reviewing and revising their segmentation models.

Sixty-one per cent rate data and analytics for clients as very important over the next 12-18 months and 65 per cent view operational scale as very important as future profitability depends on fewer financial advisers are serving more clients more efficiently, with 80 per cent reporting an increase in spending to ’change the bank’.
Christopher Sparke, Global Head of Front Office and Digital, Wealth Management at Refinitiv, says: “Wealth managers are digitally transforming all aspects of their business and require scalable, open and flexible solutions in a digital-first environment. Our research shows that 86 per cent consider servicing clients as a highly important digital capability to acquire, while 61 per cent rate data and analytics for clients as very important over the next 12-18 months. As the wealth management industry continues its digital transformation, firms need solutions that provide the data, technology and insights to empower better decisions and user engagement.”

The report further notes that the role of the financial adviser is expected to change dramatically in the next few years. In pursuit of operational efficiency, over 60 per cent of the firms surveyed are willing to leverage outsourcing propositions to enhance lacking capabilities, scale, or in-house resources. The degree of willingness ranges from 58 per cent in Europe to 70 per cent in Asia and the Americas.

Alois Parker, Research Director, Aite Group, says: “Wealth management is in transition. Client-service models, product offerings, and advisor compensation are being reviewed and redefined. Firms across the globe are aiming for increased business growth and operational scale in order to remain viable.”
The report concludes that it is not surprising that nearly 80 per cent of respondents reported an increase in spending related to ‘change the bank’ over the past few years. Going forward, firms have indicated that they are becoming more careful with this spending, as management teams analyse the impact and ROI of past and existing digital projects. Nevertheless, client needs are constantly evolving, meaning that only those firms that have the ability to invest in ‘change the bank’ initiatives will be able to remain relevant players in the future.

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