A gap exists between what banks’ wealth management divisions believe is their competitive advantage and what they are selling, according to ...

A gap exists between what banks’ wealth management divisions believe is their competitive advantage and what they are selling, according to a survey of US wealth managers by SEI Investments. Banks acknowledge that there is a significant market opportunity in an emerging wealthy segment, one that is about to receive the largest inter-generational transfer in history. Primary and secondary research conducted by SEI has shown that this emerging wealthy segment want and need advice beyond traditional wealth management. The survey shows that 52 per cent of respondents believe they are differentiating their wealth management offering through the holistic advice they provide to clients. Yet, when asked when clients seek their advice, the executives indicated that traditional offerings such as estate planning (19 per cent) and financial planning (19 per cent) are the most common. Topic areas such as elder care, special needs children and other life events were not cited as frequently. "Banks are beginning to understand that they must fundamentally change their business model to accommodate the needs of the emerging wealthy generation," said Al Chiaradonna, vice president of strategy and innovation for SEI Investments Private Bank and Trust Segment. He added: "They have a competitive advantage because of their existing banking relationships. The challenge for these organizations is to grow beyond the traditional banking relationship into the role of a trusted life and wealth advisor." The survey indicated that there are significant barriers to implementing an advice-driven model within bank wealth management departments. All respondents agreed that there are obstacles in institutionalizing the client experience across their organization, i.e. creating and delivering a consistent client experience. For example, 62 per cent of those surveyed said technology is the biggest obstacle to creating a uniform client experience. Many are challenged in trying to manage disparate platforms and effectively to mine customer data.