Private Banking Success Strategies for the ‘New Normal’

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This is a sponsored article from SS&C.

If digitalisation and operating efficiencies weren’t already a priority for private banks, the coronavirus pandemic has made these issues mission-critical.

The Private Banking COO survey conducted by Asian Private Banker in late 2020 found every respondent has accelerated their digital transformation in response to the pandemic, with 45% accelerating their efforts “significantly.” Most saw a move to remote/flexible working environments, improved quality and quantity of digital interactions with clients, and increased use of e-signatures and e-documents.

Portal to better service
Ensuring staff have access to the right tools and can continue to work efficiently has been a major challenge during the pandemic. Digital advisor portals and cloud-delivered operating systems provide much-needed working flexibility.

Effective and efficient client engagement has also come to the fore. Clients want the private banking experience to be as smooth and responsive as possible. From initial onboarding to signing up for additional services, interacting with their advisor, or staying informed about market conditions and how their portfolios perform must be delivered as a seamless experience.

The answer to delivering superior client service lies in a multifunctional client portal with rich communication and self-service capabilities. Automating account opening and investment proposal generation through a portal allows investors to self-onboard and replace traditional paper-heavy, painstaking onboarding processes. Clients enjoy a vastly improved experience, while firms benefit from significant downstream efficiencies.

Portals enable ongoing client engagement to be taken to a new level as well. Self-service trading functionality, access to offer documents and helpful research, up-to-date performance reports and a 360-degree view of their investments can be at clients’ fingertips. Secure, two-way communications allow clients to stay in close touch with their advisors for more hands-on advice as required.

By personalising digital information delivery and interactions, firms gain immense opportunities to add value and strengthen those all-important client relationships, especially during market stress periods. Intuitive portal solutions enhance client convenience and engagement, while banks increase potential client touchpoints and reduce service delivery costs.

Automating portfolio management
The pandemic has underscored another problem facing private banks: how to meet clients’ diverse investment needs in today’s markets without overburdening the front office.

Clients want well-managed, often bespoke portfolios that meet their evolving financial objectives. The problem facing private banks has been delivering such services efficiently and at scale.

Portfolio managers are firms’ most valuable and expensive resource. Still, they typically spend large chunks of their day tied up with the “mechanics” of portfolio management: allocating new capital, determining daily cash obligations, monitoring strategy and model level drift, and rebalancing accounts.

Automating portfolio construction and rebalancing tasks enables portfolio managers to create and manage bespoke portfolios faster and more efficiently. The result is timelier, informed trading decisions and actions at a lower cost and operational risk. Also, private banks can continually enhance how they engage with and support clients and prospects to differentiate their service offerings. By boosting front-office productivity, firms can maintain higher client-advisor ratios to protect their profitability.

Don’t neglect the back office
Client-facing initiatives targeting improved digital interactions and front-office productivity will fail without an integrated front-to-back environment. The most sophisticated, intuitive digital interface won’t create a standout user experience if backed by legacy technologies and/or manual processes.

Success in a post-pandemic, digitalised world, therefore, depends on streamlining systems and operational processes. Many private banks—especially larger firms with international operations—remain burdened by siloed infrastructures running multiple platforms. These fractured operating environments make it tough to deliver top-notch client service, keep up with evolving regulations and drive efficiencies across the organisation.

Maximising back- and middle-office efficiencies will be vital. Data flows that simultaneously feed trading, risk management, compliance, CRM and reporting systems will be timelier and more accurate as a result. By improving their cost-income ratios, banks will also be better placed to combat the industry’s ongoing fee and margin pressures and free up resources to fund those crucial front-office enhancements.

While the pandemic has thrown up challenges for private banks, the way forward is clear. To succeed, banks need an operational strategy that combines a lean, industrialised back-office infrastructure with agile front-office capabilities. Their future fitness demands no less.

This is a sponsored article from SS&C.

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