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July 11, 2023

CEOs’ perspectives on threats, opportunities, and technology in Wealth Management

Roger Portnoy


Tariq Khan


Reading time: 3 min


CEOs need to be mindful of both threats and opportunities to their franchise, as well as to the wider ways that business is conducted with their clients. At the recent PAM CEO dinner organized by PAM and hosted by Objectway, both were shared by leading CEOs of private banks, discretionary investment firms, private client divisions of universal banks, and wealth management firms.

Pronounced Threat

It used to be that London was a very strong magnet for high-net-worth individuals and their assets, but macro factors in recent years have seen more millionaires emigrating than ever before. CEOs are worried that the emergence of the “wrong” political climate will further exacerbate the challenges presented by a less welcoming tax regime, deteriorating infrastructure, and inconsistent services. The consensus is that the UAE and Singapore are continuing to gain the attention of the wealthy and super wealthy, and that the pull is extending to include personnel, infrastructure, and technology for these organizations in these locations. Regulators seem to be showing both more flexibility and nimbleness to attract and keep these flows, leaving private bankers uneasy about London’s and the UK’s future.

Threat and Opportunity

Wealth Managers have not seen their clients’ abandoning relationships in favour of low self-service propositions. However, firms do recognize that intergenerational wealth movements are going to necessitate a far better integration of digital services with human relationships, with AI, more than likely to play a significant role in relation to providing guidance and education for gen z inheritors. This might lead to different types of economics taking shape across the household of wealth holders, although the ultimate impact this will have on profitability isn’t yet clear to leadership. The biggest concern is that very low-cost passive asset management firms will find a pathway into the private client world through ETFs.

Technology as an Opportunity

Compared to other industries, Wealth Managers haven’t traditionally taken the lead when it comes to pushing technology into the business, especially into the front office, but regulation such as consumer duty is necessitating both more visibility to policy, as well as more consistency in client engagement. The CEOs at our roundtable all agreed that technology to monitor, amend, and coordinate business processes is an ever more valuable tool to keep compliance costs down, while still allowing the business to serve the personal objectives of their client base. CEOs also recognize that implementing the right technology approach to investment solution design can enable firms to centralize their investment management processes, while at the same time, allowing clients access to alternative and structured products that are suitable and fulfil specific tax and performance objectives. Finally, while wealth management does not have the scale in client data to immediately derive value through AI, there was a strong belief that more relationship managers would soon be supported by solutions to deliver next best action across a broader client base and enable much more timely execution of optimal investment strategies.

Our dinner once again highlighted that challenging market conditions don’t inhibit leadership from seeking to develop innovative solutions to serve their clients, and that organizations remain proactive in their efforts to capture and engage with clients regardless of the centre in which they feel most comfortable and welcome to operate.