23 May 2016

Hedgeweek: Asset management industry must adapt to cope with ‘triple whammy’ of threats in 2016

Asset management is most susceptible to fintech disruption by big data analytics and block chain.MiFID II is the regulation causing most concern among asset managers and administers, followed by UCITS V and AIFMD.

Keith Hale, Multifonds’ executive vice president for client and business development, says: “To cope with the looming ‘triple whammy’, the asset management industry needs to adapt quickly or risk disruption in a negative sense of the word. Many other industries have already been shaken by the entry of game-changing disruptors and the things they look for are inefficiencies and a high cost of production and distribution – these are all currently present in the asset management industry. If the industry doesn’t evolve, someone else could do it for them.  Unless the industry itself creates greater automation, efficiency and costs savings particularly in the middle and back office, a game-changing disruptor could soon realise that they have the reach and opportunity to do it themselves. Arguably the tsunami of regulation is proving to be a double-edged sword for the industry. On the one hand, it is currently providing a buffer against disruptive brands entering the market. But on the other, it can drive up costs which will be passed onto investors unless automation and technology is leveraged better.”

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