Manning the Frontlines: Global Asset Managers Rewrite the Rules of Engagement
June 17 2014 - 9:30AM
Business Wire
Research from State Street Highlights the Rapidly Changing
Investment Battlefield over the Next Three Years
More than three quarters of asset managers say they are
embarking on a fundamental shift in their overall business strategy
in response to changing client demands in the areas of innovation,
distribution and front office solutions, a report by State Street
Corporation (NYSE: STT) has found. The report titled, “Frontline
Revolution: The New Battleground for Asset Managers,” highlights
that although asset managers are overwhelmingly positive about the
future, true success will be defined through investing in new
capabilities, long-term investments and the right mix of talent,
transformation and tools.
“Emerging from the financial crisis, asset managers have growth
in their crosshairs,” said Joseph Antonellis, vice chairman at
State Street. “Although nearly all of the managers surveyed are
optimistic about business growth over the next twelve months, few
believe they are well equipped to provide the solutions their
clients need. To close the capability gap, the top areas of
investment over the next three years will include risk analytics,
performance analytics and data integration.”
Defending existing borders, but pushing new
boundaries:
- 48 percent of survey respondents
believe developing new products for their existing country markets
offers the greatest growth opportunity followed by growing market
share of their existing products within existing country markets
(24 percent) and bringing in existing products to new country
markets (20 percent)
- 42 percent will target growth from new
client segments
- 32 percent expect to expand number of
distribution channels
- 47 percent plan to expand into new
markets over the next three years, and of these, 60 percent are
focused on opportunities in Asia Pacific
Barriers to expansion:
- 85 percent say regulatory barriers are
the top challenge when expanding into new markets
- 55 percent say distribution challenges
deter them from expanding into otherwise attractive new
markets
- 67 percent of respondents note that
multi-asset solutions represent a major source of growth for their
business over the next three years. This reflects the shift toward
more outcome-based investment solutions for investors. However, 74
percent believe that few managers are equipped to excel in
providing these solutions.
“More than ninety percent of respondents agreed that those
managers offering the greatest degree of transparency will have the
upper hand in attracting new assets,” continued Antonellis. “Asset
managers can have a clearer line of sight by preparing an arsenal
of tools and capabilities to thrive in this more specialized and
trying environment. That comes with transforming single asset
products into fully serviced solutions.”
To secure a competitive advantage, the report highlights how
asset managers should hone their capabilities to achieve their full
growth potential by:
- Mastering regulatory compliance,
enhancing operational efficiency and focusing on enterprise-wide
agility
- Upgrading the front office to support
new growth segments and more complex multi-asset solutions
- Deploying advanced tools to deliver a
more outcome-based perspective on investment risk and
performance
- Identifying where the new solution set
requires different skills and augmenting capabilities with the
right blend of in-house and external support
State Street commissioned FT Remark to conduct a global survey
of 300 senior executives at asset management firms from April –
May. Respondents were equally distributed across North America,
Europe and Asia Pacific and managed at least $5 billion in retail
and/or institutional client assets.
To view the full report, click here.
Watch leading asset managers and asset owners talk about the
future for the industry in our new video series, The Way Ahead.
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's
leading providers of financial services to institutional investors
including investment servicing, investment management and
investment research and trading. With $27.5 trillion in assets
under custody and administration and $2.4 trillion* in assets under
management as of March 31, 2014, State Street operates in more than
100 geographic markets worldwide, including the U.S., Canada,
Europe, the Middle East and Asia. For more information, visit State
Street’s web site at www.statestreet.com.
* Assets under management include the assets of the SPDR® Gold
ETF (approximately $34 billion as of March 31, 2014), for which
State Street Global Markets, LLC, an affiliate of SSgA, serves as
the distribution agent.
CORP-1043
State Street CorporationAnne McNally,
+1-617-664-8576aemcnally@statestreet.com@StateStreet
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