Martin Frick: «Why Wealth Managers Are Struggling to Hang on to Their Customers»

Martin Frick, Managing Director Asia-Pacific, Temenos

Martin Frick, Managing Director Asia-Pacific, Temenos

Technology can bridge the gap between expectations of clients and wealth managers, Martin Frick, Managing Director Asia-Pacific of Temenos, writes in an exclusive article for

A recent report by Swiss banking software provider Temenos and media outlet «Forbes Insights» revealed a significant discrepancy between the emphasis that wealth managers and their customers place on performance and insights.

Wealth management firms in Singapore and globally have already begun investing in technologies that will allow them to satisfy the needs of younger investors who want to move effortlessly across both the analogue world of face-to- face meetings and the virtual world of digital platforms.

The question now is – how can we leverage technology to meet their expectations on performance, insights and transparency of portfolio? There are three main ways:

1. Analytics and Business Intelligence

Deep personalization in the delivery of insights and performance is one of the best ways to build trust with clients. Delivering personalized service and results is all about analytics and channels.

Business intelligence software can capture financial and customer data and offer predictive modelling that determines the «next best product» from a world of complex options, targeted to the client.

The future value and profitability of each client can be assessed.The right product gets presented to the right client, at the right time. Putting those capabilities on top of a mobile platform gives wealth managers the ability to make decisions on the go, while clients are on the go.

2. Modern Core Banking System

Legacy systems cannot scale with the growth of data and provide clients with the insights that they want. Close to half (42 percent) of wealth managers believe that legacy systems are «somewhat of a problem».

In fact, they underestimate the harm behind legacy systems. A lot of banking systems have been built in silos where the credit system is not fully integrated with the front end, and developing a platform that hand-builds data in near real time to provide insights to clients is a multiyear investment of the highest possible complexity.

As a result, wealth managers surveyed are ill-equipped to handle the varied needs of their clients. Replacing legacy systems with a modern core banking system that can handle the risk and complexity of a banking environment is the key.

For its digital private banking platform, Credit Suisse used a buy-and-build strategy that combined in-house systems it owns with technology from a selection of vendors, including a core banking system.

This allowed them to launch an app that gives clients access to account information and tools to collaborate with advisors. As a result, clients are kept empowered and engaged through receiving personalised insights at their fingertips.

3. Combining Digital Services With Advisor Expertise

Having all channels available to respond to individual preferences combined with advisor expertise is essential, it gives clients the impression that they have adequate transparency and control over their portfolio.

A significant percentage of clients (62 percent) say they want wealth managers to share information about investments and financial solutions to any of their devices, wherever they are. Calls are effective in certain circumstances, but not to educate clients on complex matters.

A video conference with screen-sharing, for example, is efficient and rewarding. So is an online conference with an expert. Advisors can distil advice to three or four major points for recommendations through Skype or Facetime versus broader, elaborate explanations through face-to-face meetings.

In this way, technology enhances the intimacy and immediacy of the client relationship, and wealth managers need to be nimble and agile enough to know which channels to pick and choose, to deliver information in which format.

Final Conclusions

To remain competitive and build long-term relationships with their clients, wealth management firms must be alert to what their customers really need. Understanding and meeting the expectations of their clients on a deeply personal level is at the core of retention.

Success depends on whether wealth managers can deliver good insights on the industry, cater to investor demand for transparency over their portfolios, and meet financial performance expectations.

  • To this end, intelligent technology will help wealth managers redefine processes, find new efficiencies and build better relationships with their clients.



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