New revisions of the European MiFID and other regulations tighten the leeway of the banks regarding investment suitability even further. They need to incorporate stricter procedures in order to ensure that they only recommend suitable and appropriate products to the client, based on the client’s risk profile, financial and personal circumstances and product knowledge and investment experience.
Although rules for careful and accurate advice were known in the market for years, hard requirements for investment suitability moved into focus with the introduction of MiFID in 2004. In the last years, many banks have struggled to implement end-to-end investment suitability procedures or implemented just tactical solutions. This resulted in severe administrative overhead at the front and in many cases in significant findings during regulatory audits due to ineffective or even missing controls.
Introducing a robust suitability framework will ensure that these hard suitability requirements strengthen the advisory process instead of being an administrative bottleneck.
The implementation of an end-to-end investment suitability framework would eventually strengthen the advisory processes of a bank and make the hard suitability requirements more meaningful and value adding to the client and the relationship manager.
With a long list of successful past projects, Synpulse has developed and showcased specialized skills, knowledge and experience in the area of investment suitability. Backed by both business and technology expertise, Synpulse is best positioned to offer its support to clients in streamlining their regulatory implementations in an effective and meaningful way.