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DST Study Finds 42% of Asian Wealth Managers See Regulatory Restrictions as Biggest Challenge to Managing Customer Data

Bank Professionals Say Existing Data Management Systems Inadequate To Coming Task

DST Global Solutions, a leading provider of technology and data management solutions for the investment management industry, today released the results of a study aimed at the condition of the wealth management industry in Asia.

The DST study “Maximising Investment Data In Asian Wealth Management” revealed that current investment data management systems among region’s wealth managers are inadequate to easily meet upcoming regulatory requirements and service customer reporting demands.

Specifically, the report showed that 42% of the bank professionals surveyed among international, regional, and local private banks and consumer banks in Hong Kong and Singapore named regulatory restrictions as their biggest challenge around client data management.

“In the face of upcoming regulatory changes, it’s easy to see why investment and client data management has become a key area of concern to the wealth management industry in Asia,” said Daniel Kennedy, Regional Head of Solutions (Asia). “Just this last week alone, the Monetary Authority of Singapore proposed changes that will require banks to further bolster operational standards and post-trade compliance checking.”

The study also reported that 34% of those surveyed named cross-border data management regulations as a key concern, followed by conflicting regulatory regimes.

“The onus is on banks to determine the best way to implement solutions to meet their obligations in any jurisdiction, and this must be done without creating any roadblocks to the business and service they deliver to customers,” said Kennedy.

About the study

The DST-commissioned study surveyed over 40 senior management, chief operating officers, chief technology/information officers, and other senior business technology-related practitioners on a number of topics, including investment data management, regulation and compliance, client experience, customer relationship management, management reporting and performance measurement.

Findings from the study indicate that:

  • Given the more intrusive rules around disclosure and tax, the integrity of data will become even more significant.
  • Adding value through enhanced performance reporting will require better analytics.
  • Banks need to think “omni-channel” by ensuring the smoothness of data moving across various communication channels.
  • Individuals want to connect with peers to get certain information that is directly relevant to them.
  • Adapting statements to provide richer analysis of a customer’s portfolio can initiate more frequent and more productive discussions relevant to the client’s individual portfolio.
  • Customers want instant access to up-to-date information on their portfolios and the ability to selectively conduct their own transactions.

The study also indicated that new legislation has become an impetus for wealth managers to implement processes and systems to ensure consistency and efficiency in the way data is collected, cleaned, segmented, stored, shared, monitored, and displayed. Many, however, have employed tactical solutions to meet quickly-imposed deadlines.

According to Kennedy, this type of short-term response only adds to the problem of finding a streamlined, strategic approach to investment data management that delivers long-term value both for banks and their customers.

“The lack of strategic attention to investment data management by some wealth managers is to the detriment of the bigger goal of making better use of investment data so banks and their customers can make more informed investment decisions.”