The asset and wealth management (AWM) industry’s revolution is ongoing. Assets under management (AuM) are increasing, as are costs and revenues. Although revenues costs have gone up, they’ve not grown at the same speed as revenues for many reasons, including economies of scale and the slow adoption of new technologies. However, with the rise of investors and regulators’ expectations in companies investing in infrastructure, talent and technology, costs are likely to grow.
In this article, we go full circle by summarising the current trends driving the AWM industry’s revolution and the inevitable changes in the market. We then outline four foundations for managers to build an operating model that protects and improves profitability.
To learn more about the four foundations for a future-fit operating model please visit our dedicated page Asset & Wealth Management Revolution: Pressure on profitability
What we think
Despite high-performing markets and managers, and rising AuM, falling fees and, in the future, rising costs will lead asset managers to rethink their operating models. In our new report, we outline four foundations that AWMs should pay particular attention to ensure that they are fit for the future. As always, managers should ensure they deliver consistently high performance and are aligned with investor’s interests.