1-Oct-03
One way to realize the goal of increasing productivity, improving client service and reducing costs is through an effective private banking systems platform. In order to capitalise on all available benefits an integrated and efficient technology solution should meet the following requirements:
All investment management business processes should be managed on a single, scalable, configurable and task-orientated platform.
Industrialised high-quality institutional and individual reporting, including multi-channel communication. A high-quality client reporting solution can increase client satisfaction while simultaneously reducing costs.
Straight- through Processing is indispensable, and the solution should cover the whole order life cycle.
Productivity functions allowing the automated rebalancing of portfolios against complex and flexible strategies or asset allocations. It should also support the observance of external and internal rules or regulations, and complex individual customer requirements for investment strategies and constraints.
Compliance controls and risk management - essential within the radically changing regulatory framework, both onshore and offshore. It may be corporate suicide not to control effectively these aspects.
The integration of a contact management system with pro-active client data monitoring - enabling relationship managers/portfolio managers to offer an all-inclusive individual service.
Implementing a private banking platform satisfying the above requirements can be quickly realised, as recently proved by Bankhaus Maffei, an entity of the HVB Group. Bankhaus Maffei is a long standing Munich based private bank, established in 1802. Their main business is in the private banking sector, in particular individual property administration. In addition to private banking, the bank is also active in institutional banking with selective bank and insurance companies. Bankhaus Maffei manages the portfolios of approximately 3000 HNWIs within the scope of a private banking approach.
Changing market conditions meant a growing IT infrastructure and higher service requirements, which led Bankhaus Maffei to decide on the need to invest in a new portfolio management solution. This system would need to increase efficiency, be STP-compliant, scalable, and capable of providing a quick return on investment.
After a meticulous selection process supported by the former HVB Private Clients division, Odysseys Portfolio Management solution Triple’A was chosen.
A fully integrated solution covering all the requirements was implemented in six months from March - September 2002. This involved a complete integration with legacy systems, including fully automated coverage of corporate action processing. A second project phase completed the integration with Maffei’s existing trading systems, and in the last step during January 2003 the processing of bulk orders was implemented via Triple’A, even though the legacy systems had not been designed for this.
Bankhaus Maffei has been able to recognise the following business benefits through running its business on the Triple’A portfolio management platform:
Complete coverage of processing requirements - for private banking portfolio management, individual client advice, order processing, and institutional asset management - on a single platform: Triple’A
An important improvement in client information – reporting and personal communications. Higher transparency helps clients to better calculate their investment risks, and cost intensive enquiries can be minimized. This is especially necessary due to new and more stringent rules and regulations aiming at preventing money laundering and other illegal fund transfers.
Managing individual’s assets on a fully industrialised basis, which was a strategic goal of the bank’s management.
Significantly improved and structured process in providing investment advice, especially in the risk monitoring of client portfolios.
The project was completed on time and within the agreed budget, and the final implemented solution had an extended functional coverage in comparison with the originally planned scope.
The flexibility of the implemented solution suite proved an advantage when HVB Group decided to merge Bankhaus Maffei in Munich with Bankhaus Bethmann in Frankfurt, creating a new entity, Bankhaus Bethmann Maffei. The business models of both banks will be fully merged, using the same Triple’A platform, doubling the number of relationship managers using the system. In addition, functionality will be offered directly to the clients of the merged bank through the web interface of Triple’A.
The Bankhaus Maffei project proved the flexible architecture and high scalability of Odyssey’s integrated solution, and in December 2002 the HVB Group confirmed Triple’A as their strategic choice for Private Banking.
The future
Market research continuously confirms the benefits from having the right technology infrastructure to meet the challenges of today’s wealth management market.
The key to success is to empower those who have direct client contact with the means by which to manage a larger number of diverse clients whilst respecting client individuality and their need for high service. Effective client relationship management is needed to retain customers within a competitive wealth management market - maintaining customer loyalty through building a valued relationship.
Odyssey has just released a new relationship management solution - Advisor - as a compliment to the Triple'A portfolio management system. A powerful client and portfolio monitoring facility combines portfolio information and client relationship management functions - providing relationship managers with an efficient anticipation and detection of all events relevant to clients and their portfolios, and then the means to pro-actively, quickly and efficiently react to any business opportunity or risk. With this full solution for managing wealth management clients, a bank is able to achieve improved productivity whilst offering a wider range of quality services to a larger number of clients.
The example of Bankhaus Maffei shows how the efficient deployment of a portfolio management solution can result in increased productivity and at the same time can significantly improve the customer services offered by the bank. Automated business processes within an integrated environment reduce administrative workload in favour of improved value-added customer service. This is increasingly important in today's race to both keep and attract new wealthy private clients.