Wealth management IT spending to pick up in 2010 - Celent
07 January 2010 | 13009 views | 0
After a tough 2009, global wealth management technology spending will see a recovery this year, rising five per cent to $3.7 billion, according to research firm Celent.
Celent, which interviewed 46 financial institutions in Europe, North America and Asia Pacific, says that wealth management-related technology projects which have been put on hold for the last two years will restart in 2010.
In 2009, total IT spending in Europe was $1.6 billion, down seven per cent on 2008 but Celent predicts the trend will now reverse with a five per cent rise. A similar pattern holds in North America, where last year's falling technology spend will be replaced by modest growth of four per cent. Asia Pacific spending, which actually rose last year to $630 million, will continue to rise, by around eight per cent.
Firms are now looking into expanding their technology projects to target a broader customer segment as well as extend their service offerings, says Celent.
These companies will continue to focus on the high net worth and ultra-high net worth individuals, but also look to expand and develop more opportunities in the mass market and mass affluent segments, focusing on self-service models.
Technology investment will focus on front office and back office requirements, including advisor platforms, compliance, reporting, self-service, and integration.
However, Celent warns that vendors will still face budget and cost constraints and need to provide an open platform to integrate with other systems and support a wide range of channels and functionalities.
Arin Ray, analyst, Celent, says: "Projects that were put on hold in 2008-2009 will likely restart in 2010. Firms will focus on reducing costs and augmenting advisor productivity through the use of technology, carefully evaluating the ROI before making any investment."