Category: Financial Management

Posted on

CI Financial Acquiring $6 Billion RIA RegentAtlantic

CI Financial will acquire RegentAtlantic, a New York-based RIA with $6 billion in managed assets. The deal will push CI over $100 billion in U.S. assets only two years after its first U.S. acquisition, according to the Canadian financial services firm.

RegentAtlantic has offices in New York City and Morristown, N.J., and offers an array of wealth planning services to a wide range of clients, including focuses on business owners, corporate executives, women on Wall Street, retirees and food and beverage industry entrepreneurs. CI Financial CEO Kurt MacAlpine said RegentAtlantic’s success emanated from its “disciplined wealth management process” that built client loyalty.

Related: CI Financial to Launch U.S. Headquarters in Miami

“RegentAtlantic is a great strategic and cultural fit with the existing firms and leadership within CI Private Wealth and fully supports our vision of building the country’s leading wealth management firm,” MacAlpine said.

As a result of the deal, RegentAtlantic’s leadership will become equity partners in CI Private Wealth, which holds CI’s U.S. wealth management business. Fiduciary Network previously owned RegentAtlantic, originally investing in it in 2007 (Emigrant Bank later acquired Fiduciary Network in 2018, and merged RegentAtlantic with the NYC-based wealth management firm Hillview Capital Advisors the following year).

Related: CI Financial to Acquire $7.5B Gofen and Glossberg

The CI/RegentAtlantic deal is projected to close later this month, and will mark CI’s third RIA affiliate with offices in New York City. The Asset & Wealth Management Investment Banking Group of Raymond James & Associates advised RegentAtlantic during the deal, while Hogan Lovells US served as CI’s advisor.

The acquisition will bring CI’s total U.S. assets past $100 billion to about $105 billion, while the Canadian financial services firm’s total global assets are expected to hit about $291 billion. The firm’s made quick work since first entering the U.S. market in the beginning of 2020 when it acquired a majority stake in the Phoenix, Ariz.-based RIA Surevest Wealth Management, becoming one of the few Canadian wealth management firms operating in the U.S. space at the time. 

“The U.S. RIA market—it is a competitive marketplace, but it is also a very accessible marketplace,” MacAlpine said during an earnings call around the time of the Surevest deal. “So, our aspirations for the RIA market are really two-fold. One, it allows us to provide a true cross-border experience for clients that are doing business with CI today. And second, it allows us to participate in this fast growing segment of the market, overall.”

CI Financial proceeded to announce a new acquisition of the $1.6 billion Calif.-based RIA One Capital just several weeks later. In all, the firm has made more than 20 U.S.-based acquisitions in the two years since entering the market. Some of the latest acquisitions include Gofen and Glossberg, a Chicago-based wealth management firm with approximately $7.5 billion in total client assets. In October, CI announced its first deal in the Pacific Northwest, acquiring McCutchen Group, a Seattle-based RIA with about $3.4 billion in AUM.

The firm is also planning to open its new U.S. headquarters in Miami in 2023, announcing in September that it leased 20,000-square-feet of office space in the city’s Bricknell Financial District with available space for core C-suite executives and personnel. According to Miami Mayor Frances Suarez, CI’s purchase made it the largest financial institution to locate its headquarters in South Florida.

“It serves as the next logical step for our expansion plans as we work to build the leading wealth management platform in the country,” MacAlpine said at the time.

Posted on

InfraSight and Grid Dynamics Bring New Observability to IT Financial Management

CHARLOTTE, N.C. & CALGARY, Alberta–(BUSINESS WIRE)–InfraSight Software Corporation (InfraSight) and GRID Dynamics, Inc. (GRID) have agreed to integrate InfraSight’s Inframeter™ technology with GRID’s industry-leading Financial Planning & Analysis (FP&A) and Enterprise Performance Management (EPM) solutions.

Inframeter™, an IT Financial Observability Platform:

  • Works across Hybrid IT and Multi-Cloud investments;
  • Measures disparate compute, graphics, networking, and storage resources;
  • Calculates Infrascore™, a metric that represents the collective cost of doing IT work;
  • Analyzes historical and current data to enhance IT forecasting, budgeting, and resource allocation;
  • Enables developers to extend its functionality through an open API.

“This partnership brings together complementary platforms to provide greater transparency and more effective IT budgeting and execution for enterprise-scale organizations,” says InfraSight Co-Founder and CEO, Tim Martin. “GRID’s value-add is exceptional, and with GRID, Inframeter is now available in new markets, including Canada.”

EPM Simplification and Operating Leverage

GRID’s portfolio of FP&A and EPM solutions enable finance professionals to simplify corporate planning and budgeting through browser- and Microsoft Excel-based interfaces while leveraging AI and advanced analytics. GRID’s approach focuses on establishing functional Key Performance Indicators (KPIs) and integrating datasets to build a comprehensive single-source-of-truth for financial and operating data.

For customers, the integration of Inframeter™ and GRID’s technology solutions:

  • Facilitates in-depth visibility and analysis of IT infrastructure consumption costs for CTOs and CIOs, while simplifying cost management for CFOs;
  • Helps decision-makers better rationalize expenses across disparate IT investments;
  • Integrates FinOps budgeting and planning with other traditional financial management practices available with broad-scope EPM solutions.

“By layering in detailed on-premise and cloud consumption statistics with financial data, this solution gives customers new insights they have been desperately seeking,” says Rick Clazie, Managing Director of GRID Dynamics.

“For many enterprises, infrastructure cost management is a highly reactive process with adjustments made only after costs have been incurred, often with huge overages,” Clazie says. “Now we can help customers proactively understand how and where utilization affects expense.”

GRID has Certified Inframeter™ Professionals on staff and is deploying the integrated solution for clients. Contact inframeter@grid-dynamics.com or info@infrasightsoftware.com for more details.

InfraSight Software Corporation

Headquartered in Charlotte, NC, InfraSight is the developer of Inframeter™, an IT Financial Observability Platform. Inframeter™ facilitates visibility into IT workload costs and provides enterprise leadership with information they can trust to make financial decisions with confidence. The Inframeter™ platform includes an intuitive executive dashboard and an open API for developers to extend its functionality and produce actionable business outcomes.

Visit: www.infrasightsoftware.com

GRID Dynamics, Inc.

Based in Calgary, Alberta, Canada, GRID Dynamics was founded in 2005 and creates tailored Financial Planning & Analysis (FP&A) and Enterprise Performance Management (EPM) solutions for all sizes of organizations. GRID helps organizations gain critical insights into their organizational performance, by designing and mapping KPIs to business objectives, streamlining and facilitating access to critical operating data, and facilitating planning scenarios.

Visit: www.grid-dynamics.com

Posted on

Ritholtz Partners With WisdomTree to Launch Crypto Index

Ritholtz Wealth Management has teamed up with WisdomTree to launch the RWM WisdomTree Crypto Index that will provide exposure to Bitcoin (36{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), Ethereum (20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) and 11 other cryptoassets (at 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} each). Those 11 additional cryptoassets include layer-1 networks, layer-2 protocols, oracle networks, crypto indexing services, decentralized finance (DeFi) and the metaverse.

While the index is currently only available to Ritholtz clients using separately managed accounts on Gemini, Onramp is bringing this to a wider swath of advisors via its cryptocurrency platform, writes Michael Batnick, director of research at Ritholtz.

“In our view, this direct indexing implementation of the RWM WisdomTree Crypto Index via Onramp Invest and Gemini is the best assembled structure and diversified cryptoasset exposure currently available to U.S. investors and particularly the RIA community,” said Jeremy Schwartz, global chief investment officer at WisdomTree, in a statement.

“Cryptoassets show great promise for financial advisors to add value, to be compensated for it, and to do so in a way that can be in line with their fiduciary responsibilities,” said Eric Ervin, chief investment officer and co-founder at Onramp Invest. “Our goal at Onramp from day one was to make this possible.”

The cryptocurrency and investing communities have waited years to have a Bitcoin ETF approved by the Securities and Exchange Commission, and, so far, no ETF that directly invests in Bitcoin has been approved. The Winklevoss twins were the first to file for a Bitcoin ETF in 2014.

SEC Chair Gary Gensler gave a speech on crypto ETFs in August, indicating that the commission would prefer funds that invest in Bitcoin futures. And Gensler just recently doubled down on his concerns about spot Bitcoin ETFs.

ProShares made history in October with the launch of the first bitcoin futures ETF, under ticker BITO. A few other bitcoin futures ETFs have listed since then.

Thrivent Gets Into the ETF Game

Thrivent, the Midwest-based not-for-profit financial services organization founded by Lutherans, has filed an initial registration statement with the SEC for an exchange traded fund.

According to the filing, the firm plans to launch the Thrivent Small-Mid Cap ESG ETF (TSME), which will be actively managed and invest in the companies with market capitalizations at or below the market cap of the largest company in either or both of the Russell 2500 Index or the S&P MidCap Index.

“The new ETF is part of the organization’s long-term strategic growth objectives focused on helping more clients achieve financial clarity,” a spokeswoman said in a statement.

It will use the “proxy portfolio” methodology, under which Thrivent will provide daily disclosures of a proxy portfolio, which reflects the economic exposures and risk characteristics of the portfolio, without revealing the actual holdings. This reduces front-running and intellectual property theft.

 

The ETF will be a completely new fund, not a conversion of one of Thrivent’s existing mutual funds. Several traditionally active managers have announced plans to convert mutual funds into ETFs.

Apollo Continues Its Move Into Retail Wealth Management

Private equity firm Apollo continues to build out its global wealth management solutions business with the acquisition of Griffin Capital, a privately held alternative investment asset manager in Los Angeles. The move adds 60 retail-facing distribution professionals and hundreds of distribution agreements, as Apollo continues to bring its products and services to the retail wealth management market.  

Apollo recently set a target at its investor day of raising $50 billion-plus of organic capital for its global wealth business over the next five years.

In May, the company introduced the new business unit and outlined plans to develop new products that individuals can invest in through financial advisors.

Griffin is particularly strong in its distribution capabilities to the independent channel, Apollo said, a nice complement to its focus on private banks, wirehouses, RIAs and family offices.  

“The democratization of finance brings tremendous opportunity for individual investors to access alternatives,” Apollo CEO Marc Rowan said in a statement. “With the acquisition of Griffin, we will significantly advance our U.S. wealth market growth plans that we presented at our recent Investor Day. As one of the first firms to bring alternative strategies to the individual investor and advisor market in the U.S., Griffin has built trusted relationships over 20-plus years, and in combination with Apollo can offer the market a broader set of solutions.”

First NFT-Focused ETF Goes to Market

Defiance has launched the first exchange traded fund focused on NFTs. The Defiance Digital Revolution ETF (NFTZ) does not directly hold non-fungible tokens, but seeks to provide thematic exposure to the NFT, blockchain and cryptocurrency markets.

The fund has a management fee of 65 basis points, and invests in NFT- and blockchain-related companies, such as Silvergate Capital Corp., Cloudfare, Bitfarms and Coinbase, among others.

Posted on

The Modernization of Estate Planning

The wealth management industry is in the midst of a technological transformation as firms look toward technology to address challenges with profit growth, changing demographics and operational efficiency.

This phenomenon is particularly noticeable in estate planning, an area long overdue for disruption that currently requires wealth managers to spend resources educating financial advisors, hiring in-house estate planning specialists, and manually converting dense documents into client presentations. Requiring this level of investment has caused many firms to reserve estate planning advice for their wealthiest clients, those who can benefit from a wider range of estate planning strategies and whose AUM justifies the costs. Yet this creates a perception that estate planning is only for the rich, despite the multitude of benefits it can provide to clients of any wealth level.

Wealthtech firms are flipping the narrative by developing solutions that democratize estate planning through artificial intelligence, design thinking and automation. Wealth managers who leverage this disruptive technology will make estate planning more accessible to a wider client base, improve the ability of financial advisors to differentiate themselves and drive future growth.  

The Current State of Estate Planning

Estate planning plays an important role within wealth management by providing an additional tool financial advisors can use to add value and build stickier client relationships. For clients, having a thoughtful estate plan in place provides many benefits including peace of mind, asset protection, and preparing future generations to inherit wealth. However, the process of providing estate planning advice is cumbersome and time-consuming.

A financial advisor must work with a client’s estate planning attorney to develop an estate plan, review the details with the client, and implement the agreed upon strategies. Once this is complete, ongoing monitoring and reporting are required to ensure that the plan continues to align with a client’s circumstances.  Over time, these plans may be challenged by difficult family dynamics, a shifting regulatory environment, or increased wealth. Financial advisors are required to stay ahead of these changes and understand their potential effects on the plan. This process requires a significant upfront and continuous investment of time by financial advisors.

Estate Planning Disruption

Innovation opens the door for the democratization of estate planning. Wealth managers who previously reserved estate planning for their wealthiest clients can use artificial intelligence and automation to begin engaging the mass affluent client segment to capture the millionaires of tomorrow. For example, a wealth manager might add an estate planning page to their client portal that allows clients to upload estate planning documents and receive automated analysis. A client that uploads their estate planning documents would consent to sharing this data with the wealth manager to enhance the level of advice they can receive. The client can then opt to meet with a financial advisor to discuss their plan or a financial advisor can proactively reach out to set up a meeting. This service would add value for clients while also providing data wealth managers can use better understand their client base.  

Estate planning technology can also improve goals-based advice by allowing advisors to provide visualizations that illustrate the alignment of an estate plan with a client’s goals. For example, a client may have a goal of gifting $1 million to their child at the end of their lifetime. Traditional goals-based wealth management technology may estimate that $500,000 invested in an equity portfolio today will allow the client to achieve this goal given their life expectancy. While the result of this analysis is financially intuitive, it fails to account for the structure of a client’s estate plan.

Today, financial advisors are required to revisit the estate planning documents to ensure the plan aligns with this financial goal. Alternatively, overlaying estate planning technology would allow the financial advisor to automatically see that the estate plan needs to be updated. This would improve their initial recommendation by suggesting that the client opens a trust to more effectively increase the probability and magnitude of wealth that can be transferred in a tax-efficient manner. By leveraging estate planning technology, financial advisors will be able to provide more holistic advice to their clients in real time.

Estate planning technology also creates opportunities to engage future generations. Estate planning attorneys recommend that clients open communication about their estate plan to prepare heirs to receive an inheritance. However, many clients may be hesitant to share the full extent of their estate plan with their children and grandchildren. Digital estate planning platforms can enable customized views of an estate plan with options to limit the information shared with heirs. This will allow financial advisors to engage future generations in estate planning discussions in a way that aligns with their clients’ wishes. These discussions provide a setting for financial advisors to build rapport with future generations and improve the ability of wealth managers to retain assets during wealth transfer events.

As much as $68 trillion in wealth will be passed down to Millennial and Gen X inheritors in the U.S. over the next 25 years. Disruptive estate planning technology will make it easier for financial advisors to prepare clients for this upcoming wealth transfer.

Vanilla, a Wealthtech startup disrupting the estate planning space, is leading the charge by creating a platform with automated estate reports, intuitive visualizations, and attorney support for financial advisors. Their technology saves financial advisors time, automates the monitoring of a client’s estate plan, and provides an accessible digital representation of the plan.

FP Alpha, another technology company focused on enabling financial advisors, has developed artificial intelligence that can interpret estate planning documents and generate plan analysis instantly. Advisors and clients can upload existing estate planning documents to generate key insights and quickly identify areas for improvement within the plan. Depending on the complexity of the estate plan, this technology could save financial advisors hours of parsing through trust and estate documents to piece together an understanding of their clients’ plans. Wealth managers who leverage this technology will increase the capacity of their financial advisors to serve more clients, while also enabling them to provide better advice.

As wealth managers prepare for an immense transition of wealth to Millennial and Gen X inheritors, effective digital strategy has become increasingly important. Currently, the estate planning practice within wealth management is a highly manual and time-intensive service offering where digitization has lagged. New technologies are disrupting estate planning through artificial intelligence, enhanced visualization of estate plans, and automated reporting. This technology will make estate planning services more accessible to the mass affluent client segment, which provides a unique opportunity for wealth managers to engage previously underserved clients who are the future of their industry.

Matthew Berkowitz is managing principal, U.S. wealth & asset management strategy practice lead, and Eden Afriat is a Senior Consultant, both at Capco.

Posted on

RBC Wealth Management Moved To A Modern Integrated Platform As Covid-19 Hit

By integrating systems and unifying data across 26 siloed legacy services, RBC Wealth Management — U.S. has reduced new client onboarding from several days to an average of 24 minutes, eliminated 200 to 300 pages of paper documents, and gone from needing 30-plus signatures to signing packets with just one digital click. 

“We were very forms-based,” said Greg Beltzer, head of technology at the wealth management firm. And while hundreds of pages sounds like a lot, much of it was disclosures, and forms for client information, from KYC to beneficiaries to investment preferences and risk tolerance. 

The firm, a subsidiary of what used to be called Royal Bank of Canada and is now RBC, used MuleSoft, a Salesforce subsidiary since 2018, to integrate its systems. RBC Wealth Management — U.S. is headquartered in Minneapolis and has 181 branches, more than 2100 advisors.and $528 billion in total client assets. 

It has managed to replace separate systems, not to mention paper files and Post-it notes, with Salesforce Financial Services Cloud and MuleSoft. 

“If we take MuleSoft and build the integrations, that piece of paper isn’t important any more and it should become an artifact that can be reproduced at any time while we keep it digital. RBC was late in its digital transformation, but that doesn’t necessarily mean it put us behind — we got to take advantage of newer technologies.”

Before getting to technology, RBC Wealth Management got down to basics.

“It wasn’t just taking a paper form and making it a PDF. That’s not digital transformation. It really is taking a look at the process of why are we collecting certain pieces of data, what is the approval or the process flow, whether that’s from a branch to director, a branch supervisor or going to compliance.”

Financial services is, of course, heavy with regulation, and that meant the project had to satisfy legal and compliance where tangible paper forms provide a certain level of comfort. Beltzer said the tech team explained it was not cutting corners.

“We said we will make it better, give more transparency and provide reporting they never had in the past. While a paper form can have a tracking number, you might not know where the form itself is.” 

They did road shows to explain how the system would work.

Beltzer’s plan is to replace all the legacy systems with more modern tools, but since he doesn’t have an unlimited budget, he is taking a phased approach. 

MuleSoft is a good fit for digital transformation “because it will not only get me to the new, but I also need something that could talk to my legacy stack until I can upgrade it, replace it, or in some cases leave it there.”

RBC is using a mix of on-prem and cloud — legacy will be on-prem and almost every new solution is cloud based.

The front end is all new, he added. 

“We brought in a bunch of UX designers and had lots of focus groups. If you loved Windows 3.1 you’d have loved our old portal. Now we have a very modern looking front end that can work on multiple form factors — we let our clients really drive that experience.”

The firm does new releases about every two weeks, while with the old system new releases were quarterly.

“They’re obviously smaller releases. But again we’re able to be much more nimble.”

Their timing was good. They started the transformation in August 2019 and finished around Christmas, just before Covid-19 disrupted business.

“ I can definitely say that getting the new system rolled out pre-pandemic was a game changer for us because it meant having everyone on the same platform. We doubled down on Salesforce to have a single 360 view of clients to be able to show to everyone, whether they were calling into a support group, product teams, compliance and especially to advisors and their staff. It was one view of the client so everybody had the same information.”

For a time the firm’s offices were closed, but advisors working from home had access to full client information on one platform. They could pull up real-time balances on assets on their phones. RBC was prepared with VPN. Although some advisors had never used it, within two or three weeks everyone had their secure access figured out.

“That first year of digital transformation has definitely paid off.”

Posted on

Insights and Advisors Will Improve Wealth Management Apps

  • When it comes to satisfaction scores, wealth managers trail behind banks and insurers.
  • Wealth managers should invest in digital tools that allow clients to access educational information through the app.
  • Insider Intelligence publishes hundreds of insights, charts, and forecasts on the Fintech industry. Learn more about becoming a client.

The news: US wealth managers’ apps scored higher in key client experience metrics in 2021, including satisfaction—but more work is needed to catch up to banks and insurers, per a JD Power Study.

Wealth management ecosystem



Insider Intelligence


The data trends: US firms’ increased tech investments paid dividends as client satisfaction improved from 2020—yet they still trailed other financial services players’ apps.

  • Wealth managers firms directed their tech spend toward upgrading their apps: 75{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} invested in feature enhancements in 2021, a 31{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} percentage point jump from last year.
  • This paid off: The study indicated more clients were using the app daily (an increase of four percentage points) and satisfaction grew nine points to 858 (on a 1,000-point scale) from 2020.
  • Yet banks and insurers scored higher on the satisfaction scale, with 860 and 877 points, respectively.

Next steps: As wealth managers strive to enhance their mobile apps— a key customer experience battleground for financial services firms—enabling access to investment insights, alongside providing direct access to advisors, will improve satisfaction.

Investing in digital tools that allow clients to access educational information through the app, such as market updates and insights on their portfolios, will improve satisfaction.

  • Clients indicate a preference for independently accessing this information, per Capgemini.
  • Just 47{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} say it is currently easy to research investment options via their wealth app, per JD Power.

Compared to other financial services firms, wealth managers’ core value proposition is the high-touch advisor-client relationship.

  • Investing in tools like instant messaging and video calls will loop the advisor into the app experience and enhance satisfaction.
  • Less than half (44{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) of clients said they communicate with their advisor through the app; this was unchanged from 2020.

Want to read more stories like this one? Here’s how you can gain access:

  1. Join other Insider Intelligence clients who receive Fintech forecasts, briefings, charts, and research reports to their inboxes each day. >> Become a Client
  2. Explore related topics more in depth. >> Browse Our Coverage

Current subscribers can access the entire Insider Intelligence content archive here.