Market Research
Wealth Management IT Spend To Grow In 2010 - Celent
The IT industry is set to receive a significant windfall from the
wealth management sector this year as the latter prepares to ramp
up its technology spend, a report by global consulting firm
Celent reveals.
Budgets allocated to wealth management technology
spending are expected to rise by 5 per cent by the end of
2010 to reach $3.7 billion, said the report entitled "Wealth
Management Business and IT Priorities for 2010: A Global
Perspective".
With the market crisis pushing companies to seek alternative ways
to reach their clients from all over the world, technology, no
doubt, plays a key role in providing quality and up-to-date
service.
"Projects that were put on hold in 2008-2009 are likely to
restart in 2010," said
Arin Ray, an analyst at Celent and co-author of the study.
"Firms will focus on reducing costs and augmenting advisor
productivity through the use of technology, carefully evaluating
the return on investment before making any investment."
Besides targeting the high net worth and ultra-high net worth
demographic, wealth management firms are also now looking to tap
the growing mass market and mass affluent
segments, particularly in the Asian region. In a
separate study conducted in 2009 by Forbes
Magazine, countries such as China and India
emerged as formidable economies that could threaten the
pre-eminence of the US or the UK.
Celent found that wealth management IT spending activities went
up 5 per cent from 2008 to $0.63 billion in 2009 and noted
that while this increase may not seem significant for now, it is
an indication of strength for the region - particularly at a time
the rest of the world has suffered declines.
Celent found Asia to present the most robust opportunities
for wealth managers, expanding at a rate of between 12 and 15 per
cent annually from 2005 to 2007. Going forward, the firm said it
expects Asian wealth management IT spending activity to rise at
an annual rate of 8 per cent starting in 2010.
Celent interviewed 47 financial institutions from Europe, North
America, and Asia for the study.
