PowerPoint Presentation

iress.comVoice of the client Response to Compeer clients view research of a 1,000 high net worth and affluent investors

Simon New Group Executive - StrategyAlex Hore Head of Key Account Management

iress.com

Account openingReportingBrand & reputationDigitalDiverseConflictingOut of stepUnexpectedUncertainAcceptingBehind the curvePassive

Key themes from research

Accessto marketsRobo

iress.comThe Compeer research provided us with valuable insight into a range of important themes which impact on high net wealth and affluent investors. Key themes to note were:client reporting still remains a priorityclient expectations appear to be evolving slower than anticipated for robo-advice and digitalbut there was also diversity in the responses

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

iress.comWe identified 6 key themes which stood out to us, which continue to impact on clients and their wealth managers/stockbrokers/advisers and brought together our thoughts and observations from working with a diverse range of business models.

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & reputation

Access to markets

Over 81% of UK investors found it easy to open an account!

iress.comAccount opening - over 81% of UK investors found it easy to open an account, which is very high.

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But compared to what?

Traditionally account opening is perceived as being complicated

iress.com81% of clients found it easy to open an account.But what is this compared to, as this something that has traditionally been known as not being easy.

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But compared to what?

With many steps from on-boarding, fact find, KYC

iress.comAccount opening involves many steps from on-boarding, fact find, KYC/AML, suitability, application forms, transfer of funds, PEP checks and workflow review.

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But compared to what?

involving multiple systems and the re-keying of information

iress.comTraditionally, account opening has involvedmultiple systemsre-keying of informationactive engagement with information flowing back & forward between clients and their providers.

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RealityClients - on-boarded quickly & efficientlyProvider - paddling madly underneath!

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Real client case study streamlined account openingPreviously the client struggled to organise themselves to on-board clients quickly and efficiently.

To help them achieve an effective on-board process, we:embedded information capture and data use, which gave our client a single entry point for information provided online image capture, which meant they could take a picture of a document and the information from the document populated the relevant fieldsautomated AML, KYC & PEP checks for on-boarding, ongoing and real time transfers to speed up transfer of funds to their businessused biometric recognition in place of signatures.

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Streamlined account opening case study

High STPwith supporting workflowOnlineimage captureAutomated AML,KYC & PEP checksEmbedded information capture& data useSlick supporting transfer processes

Biometrics - facial, voice recording& fingerprint

We now have high levels of straight-through processing & connectivity between the systemsThese benefits helped our client differentiate themselves & provide a smoother customer experience

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

Client reporting is consistently raised by clients as a key driver of satisfaction

iress.comThere is a popular belief that client reporting is consistently raised by clients as a key driver of satisfaction.Whilst there are variances between geographies, the Compeer research reaffirmed this belief. Good reporting = good perception

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Client reportingState of the nation - static, paper based, impersonal, dull, and potentially confusing.But clients are being influenced by interactions with other industries such as Netflix, Uber and Deliveroo. Clients are now used to automation, 24/7 availability, bespoke configurations.

iress.comClients expectations are being influenced by their interactions with other industries such as Netflix, Uber and Deliveroo and online travel check-ins.This means that clients are used to automation, ease of use, 24/7 availability, the ability to configure to their specific requirements. Investors understandably dont know how tricky it is to get good reporting and why should they care.However, as an industry great client reports should be our bread and butter.

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Susan Rowsell (SR) -

Client reportingBut the industry struggles to deliver great customer reporting due to:

multiple data sourceslegacy systemsinadequate data inconsistent performance calculationhandling a growing breadth of instruments

leading to manual checking, interventions & inconsistent performance calculations. This has certainly driven our approach to software design.

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Susan Rowsell (SR) -

PRE-TRADE & POST-TRADE INTEGRATIONConsolidatedClient ReportPERFORMANCE CALCSSingle Data Layer

Wholesale CustodianInternal Back OfficeInsurance ProvidersRetail PlatformsProduct ManufacturersMarket makers (RSP)Executing brokersPAPERONLINEMOBILEHow we deliver consistent and comprehensive reporting

iress.comThese challenges have driven our approach to software design and fuelled our drive to deliver consistent and comprehensive reporting.

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What does goodreporting look like?

iress.comWe dont control the output our clients do, but this is what we are seeingGood visualsInfographicsClear simple languageInteractivity.

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Presentation flexibilityDigital channels empower clients to interact in the way they choose

iress.comWhere clients are using digital, theyre empowering their clients to interact in a way that they choose. Building custom reports - where the user selects the report criteria relevant to them is increasing prevalent.Date range, benchmarks and visuals are all customisable.

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

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Mobile applications53%Germany

47%Singapore

59%US

36%France

20%UK

30%Switzerland

A big surprise from the research is that UK investors are out of kilter with other geographies when it comes to accessing their investment via a mobile application.

iress.comOnly 20% of UK investors who participated in this survey said they would access their investment portfolio via a mobile application.This one really took us by surprise the UK is really out of kilter with other geographies.This feels completely at odds not only with millennials, but with older generations and behaviours we see in other industries.

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Mobile applicationsWhy is this so low? Only a quarter of UK wealth managers offer digital channels beyond email

iress.comSo why is this figure so low?Its important to remember that only, just over a quarter of UK wealth managers offer digital channels beyond email.

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?????????????????????

Mobile applicationsNeat, agile, fast

Shows real performance

Goal tracker

Current research

Secure messaging

Transaction history

Fees

News

Not enough apps or not enough functionally rich apps?

iress.comSo is simply that there arent enough apps out there?Or, is it because the apps that are out there arent functionally rich enough?The next generation of apps we are building include secure messaging, transaction history, fees, goal tracker, fees, news etc.

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

Brand and reputation now the key criteria for clients selecting a wealth manager

iress.comNext item that deserves more analysis was the top criteria for selecting a wealth manager, which is now brand & reputation.This was a significant shift from other years where investment performance was previously the top item.

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Brand & reputation

British Banks pay 12bn in penalties

Poor compliance costs wealth manager

The biggest FCA fines of 2016

New age of banking scandal

Can you trust your Adviser?

Regulator fires warning

Banker jailed!

iress.comOur expectation was that performance would continue to be ranked number 1, but brand and reputation has now moved into that position.However, given the recent uncertain political landscape and perennial headlines about corporate fines perhaps not so much of a surprise.As an industry we continue to see lots of time and money invested in a range of brand enhancing activities from sponsorship through charitable foundations to media P&R.We are now seeing increased activity around prevention rather than just remediation.As an industry we continue to see lots of time and money invested in a range of brand enhancing activities from sponsorship, through charitable foundations to media and P&RWe are however seeing increased activity in prevention rather than just remediation

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Protecting your reputation embedding protection into your workflowClient has insufficient available cash for this transaction

This stock is a restricted list

Benchmark deviation exceeds tolerance levels

Analyst recommended sell on this stock you are attempting to buy

Transaction would push client outside of tolerable level

Annual Suitability review has not been completed for this client

iress.comTechnology is playing an increasing role in protection & prevention with flags and indicators designed to alert users. Through to more automation and MI to support compliance.Its good practice to embed checks into workflow for account opening, pre & post trading, ongoing client management. These checks and the MI generated can detect potential breaches and trigger actions. These can vary from a simple alert that can be consciously overridden by the user through to completely. blocking next steps without appropriate authorisation.

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

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What is Robo?

75% of those surveyed did not know

iress.comFascinating to see that those surveyed struggled to understand what Robo advice is 75% didnt know.Possibly that is more a reflection of the uncertainty we as an industry have around robo and its relevance.Probably also a reflection of the grey lines between Execution Only, Guidance and Advice.Certainly calls out that there is a gap between expectation and reality.We continue to see high levels of activity in this space.

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Integrated RoboExecutionOnly

Self-directed Robo Advice

Guided Advice: Face to Face

Guided Advice: Phone / Online

HolisticAdvice

Full Service No serviceIntegrated Wealth DesktopConsistent and common:Compliance Risk Profiling On-boarding System Management Configuration Security Management Information Integration Workflow Investment Ethos

iress.comFrom a systems perspective the same IT stack can power different propositions, from no service to full service. The challenge is to make sure that IT delivers relevant and consistent service for each proposition, in areas such as on-boarding, risk profiling and client outcomes.

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Key topics

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

Access to markets and trading environments remain a priority for many businesses

iress.comThe final area we see as important is implied in the research rather than directly stated is greater access to markets.Not only is the impact of Brexit driving this, but also an evolution in provider propositions as organisations seek to differentiate themselves and create compelling investment options.

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iress.comAs propositions change, access to markets and trading destinations remain a priority for many businesses.Whilst we dont see it as only a direct response to Brexit, we continue to see a proliferation of requests to extend market and trading destination coverage.

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Presentation flexibilityDigital channels empower clients to interact in the way they choose

iress.comWealthify, one of our clients are using digital, theyre empowering their clients to interact in a way that they choose. Building custom reports - where the user selects the report criteria relevant to them is increasing prevalent.Date range, benchmarks and visuals are all customisable.

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Summary and conclusions

AccountopeningClientreportingMobile appsRoboBrand & Reputation

Access to markets

iress.comIn conclusion, the survey reinforces many beliefs we have and reflects changes we see in the market.It also raise topics and poses questions that will shape the market going forward.It certainly helps us to refine the way we develop software for today and tomorrow.

Thank you and enjoy the rest of day.

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iress.comThank you

T: 0345 068 3000sales@iress.comSimon New - Group Executive StrategyAlex Hore - Head of Key Account Management

iress.com

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