The asset and wealth management industry is going through tough times, with ultra-low interest rates (negative in many geographies) making the generation of portfolio returns more and more challenging. Lacklustre equities and property markets in most regions are taking a further toll on portfolio returns. The bulk of the net new money being collected is getting routed to ETFs or index funds. Money managers across the globe are lowering their guidance on annual returns.
The impact of upcoming regulations (MiFID II, EMIR, PRIIPs, etc.) will take the cost of compliance to even higher levels. In addition, new collateral requirements for derivatives trades – which come into effect from March/April 2017 – are going to create a further adverse impact on portfolio returns.
In addition to better returns, investors of all types – be it retail, private or institutional – are now demanding more and more transparency along with a substantially better user experience. This user experience is no longer just benchmarked against industry peers but also against other related interactions, such as retail online banking which is beginning to provide extensive self-help options. Users expect uninterrupted access and near-real-time responses because of their experiences on social media and with other shared economy companies (Uber, Airbnb, etc.).
Improving overall efficiency, reducing costs and taking responsiveness to new levels is the only way forward for the industry.
How Consulting Education Advisory LLC can help
At Consulting Education Advisory LLC we help you to design and implement strategies, define and operationalise target operating models and become more responsive and lean in your operations. Our asset/wealth management practitioners have proven track records and expertise in a range of areas, including but not limited to:
- Rationalising applications (PMS, OMS, EMS, EDM, IBOR, pre/post trade compliance, performance, risk, etc.) and the service provider (fund administrators, custodians, fund distributors, etc.) landscape;
- Vendor selection, including end-to-end RFI/RFP process and running transformation programmes;
- Defining and implementing digital roadmaps, including robo-advisory and other digital/self-help initiatives;
- Compliance, both regulatory as well as internal policy guidelines, including regulatory reporting;
- Reviewing and remediating enterprise data architecture for market, benchmark and reference data;
- Refining collateral management process to take advantage of large security holdings, thereby freeing up scarce cash and improving overall portfolio returns;
- Restructuring processes like KYC, AML and client onboarding, moving them to an automated, outsourced shared utility model.