client reporting for wealth management brands : exceeding client expectations

Client ReportingExceeding expectations for a brighter future

Some thoughts from Kurtosys

Wealth Management

A perfect storm of market forces = A new era in client reporting

Margin Squeeze

Tech. advances

RegulationEmerging markets

Need to restore investor

confidence

Drivers:Fin. Crisis / Madoff / Eurozone uncertainty

Imperatives:Better understanding of riskAnalysis toolsInc. transparency

Enablers:Adv. Data analyticsMulti-channel approach

Drivers:Growth of mobileCloud computingUser Experience

Imperatives:Real time comms.Intuitive reportingInteractive tools

Enablers:Scalable cloud based platforms with mobile capability

Drivers:Basel II / Dodd-Frank / RDR

Imperatives:Agile reporting abilities, ability to offset higher compliance costs.Enablers: Better data mgt.

Drivers:Shift of wealth to the EastGrowing asset classImperatives:Heavier infrastructure needsEnablers: A global solution

Drivers:Mkt. Volatility / shift to ETF & passive investments / fee pressureEnablers: < total cost of ownership

Ernst & Young

Currently, Advisors lose an estimated 49% of AUM during generational wealth transfer.World Wealth Report, 2011

In Asia-Pacific, exc. Japan, 41% of HNWIs are < 45 yrs old

The proportion of wealth controlled by females is rising

Emerging demographics may have different needs to

long-standing HNW clients.

To serve a new era of web-savvy clients, whose expectations are high

Rapid changes in HNWI’s needs are driven by geography & technology

The population of HNWIs in Asia-Pacific (3.3m individuals) is the 2nd largest in the world – beating Europe for 1st time in 2011

India’s HNWI population entered top 12 for the 1st time

Clients in BRIC countries are tech savvy and internet enabled

“Firms could lose AUM if they fail to meet the needs of emerging HNWI Demographics”Source: World Wealth Report, 2011

Although revenues have bounced back well from the financial crisis, rising costs and market volatility means that overall profits are flat.

Operational efficiency has now become vital for success.

Reporting is an opportunity to differentiate & exceed expectations

Ernst & YoungEnhanced client reporting can..

Attract & retain AUM

Make compliance a differentiator

Reduce operational

costs

Providing an opportunity to meet a genuine client need whilst also directly improving profitability & efficiency.

“Other than the relationship manager, investment reporting is often the only “relevant” touch point with clients.”Urs Tanner, CEO, Assentis

Historically, the investment has been there....

Banks spend a higher % of

total costs on IT than all other

major industries

But IT spend hasn’t translated into better performance.... Resulting in a productivity paradox

Which may be driven by the lower

% of purchased software vs. spend

on in-house software

development

Client Reports

Which are more....

Transparent

Interactive

Flexible

Effective

Beautiful

SalesInvestment

ManagementOngoing

sales

Day-to-day account management

Greater focus on:

Retaining AUM

Excellent customer service /CRM

In response to higher & higher client

expectations....

Firms MUST have clear differentiators

to attract & retain AUM

Improved Asset

Allocation

Research Prod. Mgt.

Source: Kurtosys

An evolving model for wealth management, places greater emphasis on client reporting:

Investors genuinely value client servicing

Client service is the single

most important driver of investor

satisfaction

Ernst & Young

“The future promises significant changes that will boost client reporting to a new level, offering real-time access, customization, integration, interactivity and control.”State Street

Source: IBM: Next Generation Wealth Managememt White Paper

Making it a key selection criteria for new clients

Importance to customers

Income

Expenses

Business

Reduced Operational risk

Reduced Key Person Risk

Market Responsiveness

Faster reporting

Accuracy

Operational efficiency

Reduced IT Spend

Efficient use of staff

Straight-through processing

Single view of fund

performance

Higher retention %

Enhanced client reporting aligns customer service, ROI & AUM

Source: Kurtosys

Ernst & Young

“A growing number of wealth managers are looking to the support and resources of experienced external providers. Often, these partners hold the key to delivering the world-class service the ultra-affluent market expects.”State Street

Evaluate:

References

Credentials

Client list

Level of support

Cost

Global capability

Which increasingly means partnering with an external provider

And remember to look at the total package... You are NOT buying “just” an application...

Ernst & Young

“80% of firms have invested in technology to support client reporting.”

Build reliable reports rapidly

Pull accurate data from multiple sources

Show clients, at a glance, how their portfolios are performing

Tailor information to individual needs

Perform what-if analysis

Deliver real time, any time information over the web

Offer a rich & dynamic user experience

Please contact Simon Rose Telephone +44(0)20 8605 9770 Email simon.rose@kurtosys.com

To find out more about transforming YOUR client reports

About UsKurtosys provides digital marketing & reporting tools to help fund managers attract and retain investor assets.

Since 2002, our team of industry experts have been using digital media to transform the way that financial information is shared and consumed.

Our solutions help brands connect with their customers using the power of online and mobile communications. Our robust infrastructure and outsourcing services help eliminate unnecessary workflows and reduce costs, and our web and document design services are dedicated to making financial data beautiful.

Headquartered in London, Kurtosys has offices in New York, San Francisco, Cape Town, Gurgaon (India) and Manila.

Our presence spans five continents and our clients include some of the world’s largest asset managers.

Cognizant, Asset Management: Reinventing Reporting For the New Era of Transparency and Compliance http://www.cognizant.com/InsightsWhitepapers/Asset-Management-Reinventing-Reporting-for-the-New-Era-of-Transparency-and-Compliance.pdf

Ernst & Yound, Wealth Management Study, 2011: Investing in the futurehttp://www.ey.com/US/en/Industries/Financial-Services/Asset-Management/2011-wealth-management-study---investing-in-the-future---Technology-people-and-processes

Hubbis: Making client reporting a key differentiatorhttp://www.hubbis.com/articles.php?aid=1325819880

State Street:http://www.statestreet.com/wps/portal/internet/corporate/home/aboutstatestreet/newsmedia/newsarticles/newsarticledetail/!ut/p/c4/fY7NasJAGEWfZlZZzJcfk7E7C1pqrVpF0GyG-fmSDCYTmZmqfftG6qJIKXdxLxy4HFrSIVacTS2C6a1o6Z6WOV_uNsCe4wmw9QvA6xuD2ehjlsJ7TA-0LH7x1YoNPJlu4_kuAcjpnJZ128vh6UAPTQinJwIEFig0Or_EiydAy1vziQtGtej5WoSG7glcVNcaybtj4MYGdBYDV_2wbCCg-q7rLQG83ohoIzt8RF4Q8L7-GWOZgc4AsnGKMapYIMuqKkskS6BIU_2f0fSK6jOYM_I7-MvKN8KhfnSKeqeNFe4ruoPIm4AEpOlrJ06NwbteXmSjdNDLNYsRUCZKVQWTTOgxskLRLVq-29LTcdOeF9XkG7KLbrk!/

World Wealth Report 2011, Capgemini & Merrill Lynch Wealth Management

Information sources