When new financial regulations are introduced, financial institutions do not always have sufficient time to be operationally ready ahead of the expected changes. Often details are only clarified by the regulator a few months in advance of the introduction of the rules, so it is sometimes difficult to define a programme that can mobilise the people, infrastructure and technology, needed to comply with the regulations in time.

These concerns increase even more since typically a bank’s network consists of different branches who have implemented different solutions which falls into conflict with the regulatory requirement to provide standardised and detailed communication to all customers.

FILLING THE REGULATORY GAP TO LEVERAGE ON CUSTOMER POTENTIAL

One way that this regulatory gap may be breached is to implement a digital advisory platform that is ESG and MiFID 2 compliant, underpinned by a goal-based investment planning and advice execution workflow. This will enable institutions to adopt a consistent approach across the entire customer base.

Such a solution would provide the bank with a centralised tool that standardises the generation of proposalsthrough the different branches and simultaneously enables private bankers and wealth managers to treat their customers fairly and consistently whilst providing investment proposals that respect an individual’s preferences for sustainability and other constraints over their investments.

Such a solution can also construct efficient model portfolios reducing the complexity of the asset allocation process and providing a further consistency across the customer base.

To shorten the implementation and accommodate the customer’s business goals these solutions are best if hosted on Cloud and delivered using a SaaS model. The flexibility of Cloud and SaaS solutions allows for more efficiency in the delivery of a solution, reducing the bank’s time-to-market for its needs.

An efficient project governance structure and the management of organisational impact will facilitate a successful implementation, fully integrated into the bank’s eco-system.

To achieve this goal, novobanco, one of the largest banks in Portugal, choose Objectway as a partner to create a centralised and structured investment tool that would deliver an advanced financial advisory experience, democratising their wealth offering: the case study now available.

Finally, it has become evident that the pandemic, assisted by new technologies, has enabled private bankers, investment managers and their customers to take advantage of new tools to enhance their service. Additionally, recent regulations such as MiFID 2 and ESG have been a driver for financial institutions to review and standardise their advisory processes and respond to those customers who are increasingly attentive to the environmental and social implications of their investments.