There is a “clear contrast” between the UK’s established wealth management sector and a challenging macroeconomic environment.
The first Avaloq Wealth Management Index identifies this as the “primary constraint” on the UK’s overall competitiveness.
The index compares wealth management across 15 markets based on more than 60 indicators.
Given a one to 100 score, the UK received a score of 58, falling in the middle of the overall index.
Avaloq found the UK’s strongest performance was in its market maturity and regulatory environment, as well as performing well in technology and digital adoption.
However, the findings show “a sophisticated financial system does not necessarily translate into equally strong macroeconomic conditions”.
Suman Rao, managing director, UK and Ireland at Avaloq, says: “The findings highlight the enduring strengths of the UK’s wealth management sector.
“Strong financial infrastructure, a supportive regulatory framework and advanced digital capabilities continue to provide an attractive foundation for wealth management activity, even as macroeconomic conditions remain challenging.”
Ask FT Adviser
BETA feature — this feature is still being tested and developed
The study found that while the UK scored highly for the maturity of its financial system, the comparatively weaker macroeconomic indicators weigh on its overall index performance.
However, it said other leading wealth management centres, including Hong Kong, Switzerland and Luxembourg, also displayed “distinct combinations of strengths and constraints”.
It said this showed the wealth management sector is shaped by multiple factors rather than a single area.
Rao added: “For wealth managers, the opportunity lies in building on these strengths through continued investment in technology, operational efficiency and client experience to be better positioned to capture future prospects.”
tara.o’connor@ft.com
What’s your view?
Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
