focuses on providing more personal and sounder advice, new
solutions are being trialled and implemented to improve the quality
of service offered to clients.
While industry dynamics increase the emphasis placed on
providing this more personal service, it comes at a time when banks
have been rapidly increasing both the levels of assets under
management and their number of customers – creating an obvious
conflict.
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Biggest challenge
Banks with the greatest scale are posed the biggest challenge by
this issue, and HSBC – the biggest of them all in Europe – has
acknowledged this in part, rolling out a huge project it has termed
One HSBC.
The core system, which has been developed predominantly
in-house, serves all of the businesses across the bank, including
its private bank.
Implementation costs were $600 million in 2007, $1 billion in
2008 and will be $1.2 to $1.3 billion in 2009. The project has been
running since 2006 and, although total costs were not given, HSBC
chief information officer Ken Harvey said the project has recently
turned to a profit.
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By GlobalDataThe new technology has allowed the bank to launch a customer
proposition called Me to Me, which enables Premier customers to
transfer money in real-time between accounts in different countries
without fees.
The project is also set to create benefits on the advisory side.
The bank is experimenting with video conferencing technology with
technology vendor Nortel, which would allow advisers to speak to
and see clients through mobile phones and laptops.
While this technology is expensive for a huge bank like HSBC to
implement, it is potentially easier for the smaller private banks
and independent financial advisers to launch because they have
fewer customers and the technology investment is not so
onerous.
A report from Odyssey, a service provider to the wealth
management industry, highlights how current market conditions have
made investor protection paramount, and advice “more important than
ever”.
Odyssey recently launched its Wealth Manager to tap into this
trend, which allows its bank clients to make broad investment
portfolio decisions and then easily tailor them to individual
customer needs.
Risk management is key
The report adds the strengthening of risk management will also
be a key factor.
Didier Pitton, product managing director at Odyssey, said:
“Driven by competition, compliance and the increasing
sophistication of investment products, financial institutions have
to implement strict rules to protect private investors and ensure
they understand and manage their portfolio’s risk.”
There is also expected to be an increase in the number of banks
looking at outsourcing their CRM systems in coming months as they
look to reduce costs, streamline their systems and focus on
improving their advisory capacity.
William Cain
