Unicredit Group: FinecoBank

FINANCIAL SOFTWARE
Unicredit Group:
FinecoBank
FinecoBank launched a new
independent financial advisory service
based on Objectway’s platform
Customer reference
FINANCIAL SOFTWARE
“We have chosen Objectway Financial Suite (OFS),
a consolidated market reference platform, as our tool to launch
Fineco Advice Service. It follows the successful adoption of the one
of its modules, OFS Client & Portfolio Management”
Andrea Garino
Advice Director of Fineco
Fineco Unicredit Group
Unicredit is a leading international financial institution, operating in 22 European countries and with an international network covering
more than 50 markets, with 9.585 branches and more than 161.000 employees.
Founded in 1999, Fineco Bank is Unicredit’s direct banking entity and is also the leading on-line bank with the highest number
of clients in Italy and a network of 2.300 Personal Financial Advisers, managing 30 Billion Euros of assets. FinecoBank - Gruppo
Unicredit is a leading personal financial advisory in Italy.
Solutions
Project
Benefits
• OFS platform is currently used by 2300 advisers
Holistic Client Management
• Tailored advisory service
• The service manages almost 2 million clients with
to record contacts and clients, their
risk profile and investment attitude,
investment objectives, the cash flow and
advisory contract management.
• Up-to-date and centralised information
a total AUM of 29 billions.
• More than 3000 clients are continuously
monitored with more than 1 billion AUM under
advisory, 12 months after Fineco Advice service
start-up.
•The average portfolio size under advisory is Euro
250.000
• Efficient execution and implementation of
investment recommendations
Advice Portfolio Management
• Tailored Portfolio Construction
• Portfolio Rebalancing
• Portfolio monitoring & Alerting
Personal Financial Planning
to produce a report of the client’s
portfolio, with the possibility of
aggregating or breaking down data, to
analyse portfolio performance, value
asset allocation, back-testing and
forward-testing.
Customer reference
FinecoBank
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FINANCIAL SOFTWARE
Fineco Advice
The project called Fineco Advice was implemented with the aim to develop a
fee-based advisory service, compliant with MiFID level 3 guidelines.
As part of the project, Fineco has adopted a customised version of Objectway
Financial Suite not only to enable its advisory network to check whether the basic
services offered to their clients are compliant to MiFID level 3, but also to verify the
quality of the products, the effectiveness and the diversification of the portfolio.
Fineco Advice
FinecoAdvice was created to offer indipendent financial
advisory services to Fineco clients, based on MIFID main
guidelines: transparency and the absence of conflict of interest.
FinecoAdvice is an evolution of the leading edge advisory
service implemented in Xelion Bank and is based on the
payment of advisory fees applied to the portfolio of assets under
management.
Furthermore, the contract includes the bank commitment to
provide clients with a continuous professional support and
advisory service for their investments.FinecoAdvice is based on a
holistic approach towards the personal wealth investment process
and covers/includes all the key phases of the process:
Analysis and diagnosis of current investments, either directly
managed by the bank or by third parties;
Advisers use an open platform managing more than 4’000 funds
from 60 investment “houses”, complemented with ETFs, bonds
and forward contracts, in order to offer a customised advice,
thereby completely avoiding a possible conflict of interest, as
they are not limited just by “house products”.
Multibranding is a pre-requisite for a truly, indipendent and
qualified financial advisory service and leverages the open
platform and its tools which enable the consultant to offer
customised solutions, fully compliant with MIFID level 3
guidelines.
Almost 85% of proposed funds are third parties, as adviser’s
fees are not tied to the products they select for their clients
investment portfolio as the client is just asked to pay Fineco’s
advisory fee.
Definition of an investment strategy, based on pre-defined
portfolio “models” and on clients’ investment objectives and risk
profile;
Continuous monitoring of the portfolio performance, to
guarantee full control of the whole process.
Customer reference
FinecoBank
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FINANCIAL SOFTWARE
Fineco needed to adopt a software platform that would support the
new global and customised advisory services.
The major requirements for the platform were to support all the
different stages of the wealth management advisory process, with
a multi-channel service delivery strategy, and to be integrated with
the bank core IT system.
Fineco choice
The bank conducted a European software selection, comparing ObjectWay platform with other leading Italian and international
providers. ObjectWay Private Wealth Management Suite emerged as the best solution, responding to all the requirements: market
leadership positioning, multichannel support and ease of integration with the bank systems.
The bank acquired the following ObjectWay solutions that were
integrated with the bank core systems and the internet portal
Web Collaboration Platform:
Holistic Client Management: to record contacts and clients, their
risk profile and investment attitude, investment objectives, the
cash flow and advisory contract management.
Advice Portfolio Management that includes:
• Tailored Portfolio Construction: to identify both the client
financial profile and the asset allocation that best fit with the
client risk attitude and the overall financial profile. The asset
allocation optimal process is lead by “portfolio models”.
• Portfolio monitoring & Alerting: to constantly monitor clients’
portfolio performance and volatility with Objectway’s software.
The Financial Adviser is alerted whenever the portfolio
performance exceeds the parameters’ range established with
the client. The portfolio will also follow (be adapted to) any
significant market change, with a diversified approach towards
market trends and financial instruments.
Personal Financial Planning: to produce a report of the client’s
portfolio, with the possibility of aggregating or breaking down
data, to analyse portfolio performance, value asset allocation,
back-testing and forward-testing.
• Portfolio Rebalancing: to implement customised investment
decisions based on products that reflect clients’ investment
profile. Compliancy check with MIDIF guidelines. Complete
clients’ order life cycle management.
Customer reference
FinecoBank
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FINANCIAL SOFTWARE
FinecoAdvice closed-loop process:
Analysis and Diagnosis, Planning and Monitoring
Fineco’s Financial Advisers can manage/supervise all the different phases of the customer relationship with an integrated approach
enabled by the ObjectWay technological platform.
Analysis and Diagnosis
As a first step a client’s profile is developed to evaluate the
investment approach, the risk profile and the objectives the client
would like to reach. The Financial Adviser is supported by all the
OFS platform tools in this process. In particular, the diagnosis
consists of a check of the current client’s portfolio.
The client receives a customised financial plan and the investment
strategy is continuously backtested, projected in different/
multiple periods, verified with an efficient/optimised threshold/
borderline (frontiera efficiente). Those features allow an ex-ante
real time portfolio check and the potential impact of any kind of
investment decisions on the overall portfolio performance.
As part of the checking process, the adviser will assess the
quality of the overall current investments, even if made with
other financial institutions and will define potential risks and
opportunities. The client receives the result of the diagnosis and
will be able to redefine with the advisor the best asset allocation,
based on an objective detailed analysis of each financial
instrument.
Monitoring
FinecoAdvice constantly monitors client portfolios’ performance
through ObjectWay OFS platform and whenever a performance
issue occurs it is alerted by the system, it enables the client and
the advisor to decide together the best approach to rebalance
the portfolio performance.
Planning
The client and the personal adviser can share the investment
strategy, selecting together (in agreement) a “reference model”
asset allocation that includes the best independent products in
the market.
Customer reference
FinecoBank
Furthermore, the client will receive a detailed report on the
portfolio performance every four months. From a technical point
of view, the OFS platform constantly verifies the portfolios’ Value
at Risk, the implicit asset allocation, the level of diversification,
the performance and the Stop Loss/Take Profit through more
than fourty statistical parameters with an alerting system to the
advisor and the client for any kind of anomaly occuring.
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FINANCIAL SOFTWARE
Customer reference
FinecoBank
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FINANCIAL SOFTWARE
A successful project
The advisory network, through FinecoAdvice, has launched an innovative financial service strategic project on the market for the
coming years. The purchase of a leading software platform, as ObjectWay OFS, was the key success factor that enabled Fineco
financial advisors to provide to their clients a customised process in different areas, as the customer relationship building, the definition
of the asset allocation and the product picking financial algorithms, the implementation and reporting activities. Another key factor
was the possibility to integrate OFS Private Wealth Management Suite with the bank legacy systems that guarantees to the advisor and
to the customer an efficient execution/implementation of investment recommendations and guidelines.
Particular attention was drawn on two major phases of the project:
Analysis phase of the following: advisory and reporting
processes, integration with the bank legacy system,
product rating algorithms (Rating Advice), mapping
of the products into asset classes, portfolio risk level
monitoring. This phase was essential for an effective
development of the OFS platform;
Testing phase implemented with the aim to validate
both the customised processes and the algorithms
required specifically by Fineco. Particular attention
was drawn on clients’ reports and product mapping
algorithms on the asset classes (Style Analysis).
ObjectWay has also closely worked together with Fineco Marketing Division in the definition and selection of the graphical layout for
the diagnosis, monitoring and financial plan reporting documents. Those were highly customised by FinecoAdvice financial advisory
and communication process.
The project was developed in a close partnership with the IT Fineco group and the result was a strong IT platform integration. For
example, the integration with Fineco’s “web collaboration” platform enables Fineco clients to interact with their Personal Financial
Adviser via internet, in a free and secure manner. Any kind of investment guidelines can be implemented without the need for
additional signatures than the ones in the initial contract.
The project was started in April 2009 and was available to Fineco’s advisory network in January 2010. It included a number of releases
to further improve the service during 2010.
Customer reference
FinecoBank
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FINANCIAL SOFTWARE
Benefits
Clients can benefit and obtain several advantages from the new Fineco customised financial
advisory services, as: an advisory service tailored to the customer profile and risk attitude, a
specific focus on the investment plans, the continuous availability of information related to the
portfolio trend, the possibility for the client to manage the portfolio directly.
Fineco’s Financial Advisers can benefitt oo and improve customer relationship, being supported by
the access to centralized information that enables a more effective overall portfolio management.
The integration of the Financial Suite platform with the web collaboration bank system has
enabled Fineco to submit investment solutions proposals via internet.
The client can accept just with a “click”, instead of being asked to sign a series of paper documents,
as required by the traditional procedure.
Fineco and ObjectWay: a long-lasting relationship
ObjectWay Financial Suite has been used by Fineco since 2006.
The initial reason for selecting ObjectWay solution was for Fineco to have a unique instrument that
would enable its Financial Advisers to visualise and analyse each individual customer portfolio
managed directly by the bank.
OFS Client and Portfolio Management was at the time the only platform with a set of specific
technological features available on the market, able to integrate complex and advanced systems
and to support one of the largest leading on-line banks with a multichannel sales network.
The platform has been able to integrate in a unique database of information available from different back
ends of the bank. The integration enables the Advisers to get historical data and therefore to analyse the
positioning of each individual client’s portfolio.
Fineco is continuously investing in the evolution of OFS.
FINANCIAL SOFTWARE
www.Objectway.com - [email protected]
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