[Report] Insourcing Wealth Management Market Research, Trends, Analysis TOC

CHAPTER 1 INSOURCING TODAY
- In which areas is insourcing being offered?
  - Banks have become involved in insourcing along all parts of the value chain
    - In focus are the less critical middle and back office operations
    - Under certain circumstances, insourcers can give input on front office activities
    - ...but some have moved into the IT services area, facing competition from IT companies
    - Swiss private banks have brought insourcing to the full wealth management spectrum
    - The requirements for international offerings are very complex
    - Smaller players have developed innovative solutions
    - Differentiation centres around market knowledge and cost reduction
- Why (not) consider insourcing?
  - Economies of scale are the main driver for insourcers
- Benefits for client banks
  - Cost reduction makes one case for outsourcing
  - ...but risk management and increased efficiency are also important
  - Some retail banks seek access to wealth management know-how
- There are risks to both parties
  - Outsourcing banks bind themselves to one service provider
  - Outsourcing banks could lose customers to their partner bank
  - Errors in the IT system could put the insourcing bank out of business
  - The insourcing bank could experience a knowledge drain
  - Making insourcing services profitable
- It is not a fast moving market
  - The key challenge for insourcing banks is the mindset of potential partners
    - The decision to outsource is not an easy one
    - The competitive situation can hinder the take-up of insourcing services
    - Insourcing solutions have to be modular to be successful
    - Are the available IT systems suitable for insourcing?
    - It is difficult to cover the complexity of the investments sector
    - Training of the partner bank' s sales staff can be very time-consuming
  - What can support growth of insourcing relationships?
    - Making use of existing relationships
    - Developing other geographies
    - New product and service opportunities
    - Deterioration of the financial markets
- Key considerations for insourcing services
  - IT system infrastructure must be appropriate
  - Potential insourcing business must have demonstrable a USP
  - There must be a potential client base of willing outsourcers
  - There must be board level commitment to launch an insourcing business
  - Once the agreement is in place, communication and knowledge flow are critical
CHAPTER 2 KEY PROVIDERS
- Bank Vontobel: the allrounder
  - Co-operation management is part of Asset Management & Investment Funds
  - More insourcing co-operations are to follow
    - Co-operation with the Raiffeisenbanken is Vontobel' s model case
    - The Raiffeisen Group uses the Vontobel brand
    - Vontobel develops products and services that are suited to the Raiffeisen clientele
    - Vontobel' s support of distribution and marketing plays a central role
  - Vontobel has entered a new strategic partnership with T-Systems
    - VONSYS - Vontobel Solutions for Your Sourcing
      - Wealth Team View
- Credit Suisse: Expert to Expert Banking
  - Credit Suisse is one of the Top 10 financial services companies by assets under management
  - Credit Suisse restructured its interbank services in 2005
    - Expert to Expert Banking has become part of a dedicated Financial Institutions department
    - Expert to Expert Banking combines expertise from asset management to trade finance
    - Trust plays a very important role
    - Some areas of Expert to Expert banking have a domestic focus
    - Credit Suisse can use independent private banks within the Group to test-drive services
  - Wealth Team View
- Maerki Baumann & Co. AG: indepedence is key
  - Banking services are going independent
    - Transaction banking will become an independent entity: InCore Bank AG
    - MBC has developed Legando, its proprietary IT platform
  - Only a few partner banks take the full outsourcing approach
    - Zuger Kantonalbank uses the most comprehensive service
    - Pricing does not increase with the number of transactions
    - Insourcing can add most value through administrative services
    - MBC' s insourcing services had a difficult start
    - MBC sees its independence as a key differentiator
    - MBC is looking across the frontiers
  - Wealth Team View
- UBS: The Bank for Banks
  - UBS is currently the world' s largest asset manager
  - The Bank for Banks service includes an extensive range of services
  - UBS' s differentiator is the front end
  - UBS is looking into new markets and product areas
    - Wealth Team View
- Wegelin & Co.: not to be sneezed at
  - Small but powerful
    - Insourcing to gain economies of scale
  - Different types of co-operations exist
    - Special case: Bank Linth
    - Business Process Outsourcing
    - SPtailormade
  - A less favorable investment climate could force smaller banks to rethink their strategy
  - Efficient data management is a challenge
  - Wealth Team View
APPENDIX
- Definitions
  - Insourcing
  - Kantonalbank
- Research methodology
- Further published research
  - Global Wealth Management SPP
    - Interactive Databases
    - Market Reports
    - Strategic Insight Reports
    - Wealth Management Competitor Tracker
    - SPP writing team
- List of Tables
  - Table 1: Bank Vontobel AG: Key figures, 2004-5
  - Table 2: Credit Suisse: consolidated key figures, 2004-5
  - Table 3: Maerki Baumann & Co. AG: Key figures, 2004-5
  - Table 4: UBS Group: Key figures, 2004-5
- List of Figures
  - Figure 1: Positioning of key insourcing providers, 2006
  - Figure 2: Pros and cons for both sides
  - Figure 3: Key challenges for insourcing services
  - Figure 4: The VONSYS business model, 2006
  - Figure 5: Expert to Expert Banking: Products and services, 2006
  - Figure 6: Legando: connectivity and integration, 2006
  - Figure 7: Legando modules, 2006
  - Figure 8: UBS: The Bank for Banks services, 2006
  - Figure 9: The Bank for Banks: Private Banking services, 2006

Insourcing in Wealth Management 2006

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