Wealth management firms must adapt to new landscape
Industry players need to plot new growth strategies and evaluate the potential for leveraging scalability if they are to succeed in the wealth management business. July 05, 2012 | Magessan RajWealth management firms are facing a daunting task. Lower fee income, pressure on improving service standards, wealth decline of its clients, and a product suite that is often no longer suitable have lowered overall income generation. In this context, high cost ratios are hitting the industry hard. Wealth management firms have seen costs escalating faster than growth in revenues in recent years, according to findings from the recent World Wealth Report 2012, RBC Wealth Management group head George Lewis stresses the imperative for these organisations to re-evaluate and reassess their business models to manage client assets under management (AuM) more effectively without adding incremental resources and costs, and the importance of bolstering their client-advisor relationships. According to the report, the world’s 11-million-strong population of high net worth individuals (HNWIs) in 2011 saw minimal change in terms of size. However, HNWIs’ aggregate investable wealth, measured by asset value, has declined for the second time in four years, with the overall financial wealth declining by 1.7% to $42 trillion. India and Hong Kong were worst hit by the decline in HNWI population, recording 18% and 17.4% reductions respectively, whilst the Asia Pacific region became home to the largest HNWI population at 3.37 million despite North American HNWIs still accounting for the largest regional share of HNWI wealth. Looking at the economic and market conditions in 2011, there were indeed several key regional developments that unsettled markets and investors, with Capgemini Global Financial Services head of sales and marketing Jean Lassignardie singling out the downgrade of numerous sovereign-debt ratings in Europe, with concern over the future of the Eurozone, and in particular that of Greece. Over in North America, the US was stripped of its “AAA” sovereign debt rating by Standard & Poor’s in a move which reflected the impasse over th... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: Retail Banking, Wealth Managementretail,Wealth Management, Retail Banking,Wealth Management, Keywords:World Wealth Report 2012, HNWI, RBC, George Lewis, Jean Lassignardie, AuM World Wealth Report 2012, HNWI, RBC, George Lewis, Jean Lassignardie, AuM
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