The panel began with a run-through of the Swiss wealth ecosystem and where the EAM sector fits in. The EAM segment is said to have assets under management (AUM) of SF500 billion, 20% of the total assets managed by Swiss banks. Indeed, the EAM sector is a well-regarded and deeply-embedded part of the Swiss financial ecosystem.
But like all of the component parts of the Swiss wealth management ecosystem, EAMs need to think carefully about how to make the best use of technology to future-proof themselves and make sure they have the technological tools to exceed client expectations and innovate.
There are currently some major friction points, including inefficient manual processes, lack of standardisation across banks, regulatory and KYC differences, customer service propositions, quality, and efficiency needs. The result is a fragmented relationship between the EAM, custodian banks, and the end investor that is neither as smooth nor seamless as desired by all parties.
A number of efficiency gains have already been achieved. These include API-based connectivity around order routing, portfolio data flows, and documentation. However, barriers still exist in implementation costs and availability across all bank partners.
Armakan pointed out: “Technology use is not just about efficiency; it is also about the quality that is offered to the customer. It is the wide range of asset classes covered and the depth and quality of the data and analytics around the investment proposition. This is how to differentiate.”
He also noted that Artificial Intelligence (AI) is likely to make a significant impact in terms of both efficiency and service – alongside data analytics and automation.
“The new use cases currently emerging with AI, offer the means to do a better job for clients and incorporate more efficiency into processes. This something very exciting, but care is needed to make sure that AI use is appropriate; we should not lose sight of the customer’s needs.”
Standardisation
Standardisation is another feature of the landscape. The Swiss OpenWealth initiative is playing a leading part in solving this issue with its vision to facilitate open finance by moving towards common standards. Gradual adoption was expected to be the way forward to the benefit of all-end clients and investors alike. But the idea is that if processes between the various counterparties, the custodian bank, the EAMs, and the technology providers are better, then this will add up to better levels of service, cost reductions, and more automation or digitisation.
“The Open Wealth initiative is very valuable. We can work towards a harmonised output using data more accurately and efficiently with the end result being a better service to customers,” he concludes.
About the Swiss WealthTech Live 2024
Our Swiss WealthTech Live 2024 event took place in Zürich in February and hosted some 160 market participants from private banks, cantonal banks, external asset managers, family offices, technology vendors, consultants, and more to express their views, experiences, and visions for the future. We celebrated a full day of keynote presentations and panel discussions, with plenty of networking opportunities.
During the event, we also released our Swiss WealthTech Landscape Report 2024. This issue of the report includes 24 thought-provoking articles, 10 Solution Showcases, and 539 entries in our Solution Provider Directory.
Access the full report here.
