Title of the presentation

Wealth Management Trends for 2017

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial Services

Wealth Management Trends 2017Spate of regulations is encumbering wealth management firms with more compliance related activities

Increased Focus on Fiduciary Duty and Client InterestBusiness-As-Usual Taking Up a Significant Portion of Investment BudgetContinued Focus on Cybersecurity in Light of Increasing Digitization123Wealth Transfer Remains A Significant Growth OpportunityShifting client needs are disrupting established models while also creating new opportunities

Emerging Advisory ModelsEvolving Fee Models456In response, wealth mangers are seeking enhanced digital capabilities and firms are focusing to improve mid- and back-office productivity

Growing Demand for Digital By Wealth ManagersSurge in Robotic Process Automation78Furthermore, firms are also looking to leverage emerging technologies and partnering with FinTechs

Collaboration With FinTechsIncreasing Application Of Artificial Intelligence Based Analytics910

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesFiduciary Duty Gaining Prominence due to Regulatory FocusUS$17 bnYearly cost for American clients because wealth managers are incentivized to push higher margin productsDOL Fiduciary Rule to be Effective from April 2017Lower Costs for ClientsStricter Regulatory EnvironmentTransparencySource:Capgemini Financial Services Analysis, 2016; Obama Vetoes Resolution to Kill DOL Rule; New Lawsuit Filed, Diana Briton, Wealth Management, June 9, 2016, accessed October 2016 at http://www.wealth management.com/legal/obama-vetoes-resolution-kill-dol-rule-new-lawsuit-filedBICEBest Interest Contract Exemption (BICE) conditions will ensure that advice is in clients best interest

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesBusiness-as-Usual Taking Up a Significant Share of Investment Allocation of Firms15.3%Investment budget needed for business-as-usual activites, restricting new proposition developmentSource:Capgemini Financial Services Analysis, 2016; WWR Executive Interviews, 2016 Increased compliance requirements make day-to-day activities a burdenWealth Managers want better digital access and collaboration with clients

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesContinued Focus on Cybersecurity in Light of Increasing DigitizationIncreased InvestmentsMore Openness = More RiskPrime Targets74%Wealth managers had been a target of a cyberattackSource:Capgemini Financial Services Analysis, 2016; Is your wealth manager a target for a cyberattack?, Deborah Nason, CNBC, February 3, 2016 accessed October 2016 at http://www.cnbc.com/2016/02/02/is-your-wealth-manager-a-target-for-a-cyberattack.html

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesEmerging Advisor-Client Relationship Models to Cater to Client DemandPure Automated Advisory ModelSource:Capgemini Financial Services Analysis, 2016Hybrid Advice ModelHolistic Goals-Based Financial Planning and Wealth Management Model

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesEvolution of New Fee ModelsOnly 23.6% of HNWIs want AuM based fee, but 30.1% use it currently.Performance based Fee StructuresChanging Customer DemandNew Value PropositionsSource:Capgemini Financial Services Analysis, 2016; Capgemini Wealth Manager Survey, 2016

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesIntergenerational Wealth Transfer Remains a Significant Growth Opportunity$36 tnWealth is expected to be transferred to heirs from 2007 to 2061Need for succession and inheritance tax planningSource:Capgemini Financial Services Analysis, 2016; New Report Predicts U.S. Wealth Transfer of $59 Trillion, With $6.3 Trillion in Charitable Bequests, from 2007-2061, Boston College Center on Wealth and Philanthropy, May 28, 2014Great opportunity for wealth managersNew demand of younger HNWIs

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesGrowing Demand for Digital Tools by Wealth Managers80%Wealth Managers believe digital tools have positive impact on their overall ability to cater to HNWIs72.9%HNWIs say digital maturity is significant in increase/decrease decisions with asset allocationHigh Demand for digital capabilities by HNW clientsWealth Managers want better digital access and collaboration with clientsSource:Capgemini Financial Services Analysis, 2016; Capgemini Wealth Manager Survey, 2016; Global HNWI Insights Survey 2016, Capgemini

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesSurge in Robotic Process Automation in Mid- and Back-OfficeReplace Routine, Repetitive, Rules-based Tasks Improved Compliance Source:Capgemini Financial Services Analysis, 2016Enhanced Accuracy

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesIncreasing Collaboration between Incumbents and FinTechs FinTech Innovation & Development CapabilitiesSynergy will Enhance Client ExperienceIncumbent Distribution and Brand LoyaltySource:Capgemini Financial Services Analysis, 2016

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial ServicesIncreasing Application of Artificial Intelligence Based Analytics SolutionsCost Benefits Productivity GainsMore CustomizationSource:Capgemini Financial Services Analysis, 2016

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial Services

About Capgemini

With more than 180,000 people in over 40 countries, Capgemini is one of the world's foremost providers of consulting, technology and outsourcing services. The Group reported 2015 global revenues of EUR 11.9 billion. Together with its clients, Capgemini creates and delivers business, technology and digital solutions that fit their needs, enabling them to achieve innovation and competitiveness. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore, its worldwide delivery model.

Learn more about us at www.capgemini.com

Rightshore is a trademark belonging to CapgeminiThe information contained in this presentation is proprietary. 2016 Capgemini. All rights reserved.www.capgemini.com

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Copyright Capgemini 2016. All Rights ReservedPresentation Title | Date | Financial Services