KBS - Financial Services and Wealth Management - Market Insight

• Moreover, disruptive technologies will improve wealth management firms’ offering, especially in regard to delivering personalised HNW–style financial solutions.

• Managers believe customers’ preferences will move towards personalised solutions as technology evolves. This can be attributed to the wealth transfer, estimated at $68tn over the next decade, to the younger generation.

• However, trust in technology, i.e. that data is protected and used responsibly, plays a pivotal role in the introduction of new technologies. Moreover, 67% of asset and wealth managers voice concerns regarding the accuracy of decisions made by technology. + CONSOLIDATIONS • 81% of firms are contemplating strategic partnerships, consolidations or M&A to advance technological capabilities and build an ‘extended tech ecosystem’. • 73% of asset managers considering M&A see it as a way to gain access to skilled expertise over the next two to three years. + TOKENISATION • Tokenised investment funds are expected to surge at a CAGR of 51% by 2028. Tokenised fractional ownership allows retail investors to buy small stakes in private markets and funds. Moreover, reducing the amount of investment needed may mean otherwise illiquid assets being traded on secondary markets. Approximately 50% of managers and institutional investors favour PE as the top tokenised asset class. + ESG • New gen investors, e.g. millennial and Gen Z investors who are expected to inherit $68tn in the next 10 years, are interested in ethical investment. This creates opportunities for asset and wealth management to seek ESG-aligned investments.