Giant Steps for Growth

14 www.financialstandard.com.au Feature | Platforms 3 September 2018 | Volume 16 Number 17 GIANT STEPS FOR GROWTH Platforms are moving away from being fixed administrators of investment products to dynamic enablers of financial advice. Harrison Worley explores how platforms are keeping pace with the needs of the financial planning community. www.financialstandard.com.au 15 3 September 2018 | Volume 16 Number 17 Platforms | Feature 01: 02: 03: Arnie Selvarajah Richard Tourneur Dina Kotsopoulos chief executive director and planner head of platforms Bell Direct Tourneur Financial product management Planning BT Financial Group n the previous edition of Financial Standard, journey, but don’t want to relinquish complete count fee of $540 will be charged per annum. I Karren Vergara explored managed ac- control from it,” he says. The fee structure is also set to apply to advis- counts and how the $50 billion market im- “It’s moving from ‘do-it-for-me’, to ‘do-it- ers and their clients using BT Wrap and As- pacts the lives of its ever growing client base. with-me’.” gard eWrap, should they elect to access it. Managed accounts are clearly important, but On the technology front, director and plan- BT Financial Group head of platforms they are just one-quarter of the investment ner at Tourneur Financial Planning, Rich- product management Dina Kotsopoulos03 says platform market. ard Tourneur02, says further developments in BT’s new pricing structure was designed to Australia’s total platform market is even platforms are necessary, highlighting Colonial increase transparency, by ensuring clients and bigger, worth $665 billion in funds under ad- First State now offers a “t+1” trading feature their advisers were charged the same fees right ministration according to Rainmaker Informa- which helps advisers take action if they foresee across BT’s platforms – despite platform pric- tion’s latest Advantage report. Understandably volatility in the market. ing having historically been differentiated be- some of the country’s largest financial institu- “If a client wants to increase or decrease tween advice licensees. tions dominate market share. their market exposure, provided they get in be- “In recent years, we’ve seen a lot of change However, in a move that would have been fore the close of day, we get that day’s unit price in a competitive market and it is important for unimaginable only a few years ago, the big – even though it takes a couple of days to pro- a platform to offer great functionality, qual- banks – Commonwealth Bank, National Aus- cess, it’s back dated to today,” Tourneur says. ity investment options as well as an attractive tralia Bank and ANZ – in quick succession “So if we see volatility in the market – where price,” Kotsopoulos says. this year offloaded the majority of their wealth the market might move 4-5% in the day, which management arms (including their platform happened for example when US President A platform for technology businesses). In this sense, the jury is still out on Donald Trump got elected – we’re able to move According to planner Tourneur – who says his who will be the market leaders in the long haul. quickly for the client.” top three platform providers are BT, Colonial Industry experts suggest the next battle- He says features of this ilk aren’t offered First State, and OnePath – platform provid- ground will be multi-dimensional. Platforms across the industry, meaning some advisers ers need to consider how technology can move will have to fight it out on fees, innovation and, are better placed to deal with volatility in the the sector forward. most important of all, client-centricity. market than others depending on the platform Specifically, the adviser says he wants tech- To those long in the tooth, these issues aren’t their client’s investments sit within. It’s moving from nological advancements to enhance the knowl- new, but with the Royal Commission putting ‘do-it-for-me’, to edge of the client. the industry under a harsh spotlight, and the Fees, fees, fees ‘do it with me.’ “Looking at moving more with the technol- new players fast gaining market share, the Fees have become a central issue for platform Arnie Selvarajah ogy, being able to move forward and people stakes are higher and the consequences of be- providers in 2018, and have global implications. will get different ways to access information,” ing complacent are potentially fatal to those at For example, the UK financial market regu- Tourneur says. the bottom rung of the ladder. lator harbours concerns over fees and the man- Artificial intelligence, machine learning A report from global advisory firm NMG ner with which they’re charged by platforms in and natural language search capabilities are Group shows Australian advisers agree plat- the UK (see breakout). all under development for Macquarie’s platforms are playing an ever increasing role in Specifically, the Financial Conduct Author- form offering. their businesses. Platform satisfaction in- ity says it is concerned with fee transparency, Macquarie Wealth Management head of creased 2.4% to 72.1% in 2017-18, NMG says. saying fees were hard for consumers to under- wealth product and technology Cameron Gar- The advisory group says improvements in stand and compare. rett04 says each innovation is subject to the technology are partly responsible for increased As part of its announcement to offer BT same core consideration – will this improve the adviser satisfaction with platforms. It says im- Panorama Compact, the platform giant said it life of an end user with changing needs? provements in technology have been spear- would offer a new fee structure to new users of He adds Macquarie will be making improve- headed by the majors, but not without serious BT Panorama, aiming to increase fee transpar- ments to the adviser side of its platform over contention from challengers such as Netwealth ency across BT’s platform offerings. the next year-and-a-half, to bring the adviser and HUB24. New customers to BT’s flagship investment and client experiences into line. Bell Direct chief executive Arnie Selvara- platform will now automatically access BT As part of the upgrade, Macquarie is set to jah01 says in the last three years, the relation- Panorama Investments and BT Panorama Su- transition to a new portfolio management sys- ship between advisers and clients is becoming per via a new asset-based administration fee tem, which Garrett says will further modernise more holistic when it comes to platforms. of 0.15% per annum across their assets, which its offering by moving data to the cloud – giv- “Clients want help to navigate their wealth are capped at $1 million. An additional flat ac- ing the platform real-time capabilities. Who is leading our industry? BT has a 50 year history of supporting financial advisers, and now BT Panorama will change the way we work together. bt.com.au/btopen BT Funds Management Limited ABN 63 002 916 458 AFSL 233724 is the issuer of BT Panorama Super, part of Retirement Wrap ABN 39 827 542 991. BT Portfolio Services Ltd ABN 73 095 055 208 AFSL 233715 operates BT Panorama Investments and administers BT Panorama Super. Consider the PDS or other disclosure document, available by calling BT on 1300 784 207 or at www.btpanorama.com.au, before deciding whether to acquire or hold the product. Investors should consider whether the product is appropriate for them. 16 www.financialstandard.com.au Feature | Platforms 3 September 2018 | Volume 16 Number 17 04: 05: 06: Cameron Garrett Jennifer McDermott Laird Abernethy head of wealth product executive product head of retail sales and technology manager, portfolios Colonial First State Macquarie Wealth IRESS Management BT’s Kotsopoulos says open banking and AI being tied to large, inflexible organisations Macquarie’s Garrett agrees that demands are set to transform platforms. with high cost bases; those platforms that are for passive investment choices are increasing “There are opportunities in open banking able to move to open architecture models, rath- across the market. Macquarie’s Wrap platform and more broadly, through open API struc- er than closed product offers, will fare well.” is beginning to integrate ETFs as part of the tures, and areas such as artificial intelligence Selvarajah believes the platforms which in- group’s commitment to offering diverse invest- and machine learning will continue to play a novate to assist advisers with client engagement ment options. key role in shaping developments across the in- will be the ones to end up on top. “Many clients are now choosing to have dustry,” she says. “This is going to be the battleground of the ETFs as a core part of their portfolio given the BT actively incorporates client and adviser future,” he says. cost and diversification benefits, this is keeping feedback, pointing to the market leader’s recent Garrett echoes the sentiment, saying the fu- with the broader market trend of an increase in inclusion of digital consent technology to BT ture for Macquarie’s platform lies in an open passive investing,” Garrett says. Panorama, she adds. architecture approach. “That said, as ETFs are maturing in the Features such as digital consent technology “It will enable us to partner with market market, they are evolving beyond passive in- help clients and advisers to better manage the leading technology solution providers, and We see the future vestments.” Is there a way to make transaction approval process and readily seize seamless integration between the technology of our platform Recently the wealth giant announced the investment opportunities, she adds. ecosystems of our advisers and their clients, being based on an launch of Vanguard separately managed ac- IRESS executive product manager, portfo- no matter what their technical environment open architecture counts on Macquarie Wrap, with the invest- lios Jennifer McDermott05 says the software is,” he says.

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