Wealth managers are having to raise technology spending and become more transparent as a result as part of a drive to reassure clients about their service offerings in a challenging environment, according to Celent, the US-based consultancy.

On average, Celent found that firms expect to increase IT budgets in 2012 by 5-10 per cent. Latin American wealth managers will be more aggressive in increasing budgets in the near term, boosting budgets by, on average, 10-15 per cent.

The report is called Wealth Management IT Spending: A Survey of Priorities and Spending Among Wealth Managers. It was drawn from 46 responses from family offices, brokerages, private banks, trust and investment managers in North and South America. (To view the full report, click here).

The majority of wealth managers have indicated a change in strategy over the past 12 months, the report said. Wealth managers are most commonly using a combination of third-party solutions and in-house technology, it continued.

Celent found that North American and Latin American wealth managers have similar technology priorities, but North American wealth managers' technology adoption is more mature, which is perhaps unsurprising given the relative immaturity of the Latin America wealth management market.

“North American firms are more likely to have implemented their wealth management technology than Latin American wealth managers. Furthermore, while wealth managers of both regions are focusing on providing similar tools to advisors, North American firms are likely to be improving their tools, whereas many Latin American wealth management firms are still in the midst of implementing their strategy and technology,” it said.

“Advisors are increasingly taking a holistic view of their customers and delivering solutions to help their clients meet their goals. Such service will help justify fees and create loyal relationships. The firm that is first to be able to demonstrate this level of service to a client will likely lock itself in as the primary advisor and squeeze competitors out,” it continued.

“Within the next 18 to 24 months, a number of wealth managers will be launching applications for both advisors and end users. However, many firms have yet to view mobile technology as a 'must have' service differentiator,” it said.

The report said that firms are more likely to launch tablet applications for advisors, as opposed to smartphone applications. Firms launching applications for end users will have to launch on both smartphones and tablets, it said.

“Celent expects that, in the medium term, vendors and wealth managers will slowly rebuild the advisor desktop into a tablet-based desktop. In Latin America, there is an even slower time frame, with most wealth managers expecting to adopt mobile technology in a three-year time frame,” it said.