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Banking on technology with the human touch
How will technology affect banks over the next five years? Is it a friend or foe? Such were the issues debated at Lombard Odier’s all-day Technology Fair on Thursday, 31 May at its Corraterie headquarters in Geneva.
No one denies that technology will transform business models and processes but views differ widely over the speed of change and the roles of big data, artificial intelligence and blockchain.
“The private bank offering of tomorrow will be a combination of human and digital interaction,” said Stéphane Monier, Chief Investment Officer, Lombard Odier Private Bank. “Technology is going to allow us to provide a more personalised client experience.”
Intelligent machines will take on more and more of the routine work, he believes, bringing even greater effectiveness and efficiency, and freeing people to concentrate on the complex, value-added services. This is particularly true of the interpersonal and emotional aspects of the advisory process.
“Just as people still want to visit a doctor despite all the advances technology has brought to medical science and made available even on the Internet, so wealth management clients still want to talk face-to-face,” said Stéphane Monier.
Big Data can also help better manage risk. This is true, for example, when it comes to incorporating environmental, social and governance (ESG) analysis into investment decision-making.
“ESG data is growing rapidly and globally,” said Véronique Menou, Head of ESG Portfolio & Index Research at MSCI ESG Research. “We are integrating ESG data into our investment processes to…mitigate long-term risks.”
Leslie Sita, Portfolio Manager, Lombard Odier Investment Managers agrees.
“The challenge is that different people access the data in different ways but technology is helping us to have centralised information, financial and non-financial,” she said.
As for blockchain, the shared database technology that powers cryptocurrencies such as bitcoin, opinions varied widely between game-changer to hype.
Simon Taylor, Cofounder and Blockchain Practice Lead at 11:FS, spoke up its advantages in terms of efficiency, transparency and speed, arguing that now is the time for companies to consider how this technology could benefit them.
Laurent Mélon, Lombard Odier’s Head of Product Development, T&O, challenged the speakers on how blockchain would be used in the private banking space.
Stefan Teis, Head of Blockchain at Deutsche Börse, struck a conciliatory note. “Implementation of Blockchain/DLT in the financial sector is still evolving,” he said. “Main issues for broad usage are regulatory and legal uncertainties which need to be resolved first”
“If you don’t provide more value from the data you use and clients feel you are abusing the data without adding value to their banking experience, you risk losing client’s trust and that is a fine line,” said Martin Moeller, Digital Transformation Principal for Banking & Finance in Western Europe at Microsoft.
How can banks personalise data and make the connections between data sets necessary to create real added value for clients?
The future lies in structured data – that is data organised in a highly manageable way. Many banks are still far from being able to retrieve or organise all their data in a useful way.
Our Technology Fair also offered a wide range of experiences from time travel back to the 50s when we acquired our first computer to a virtual tour inside our new Bellevue headquarters. Other booths offered advice on protecting your cyber security and an android that interprets emotions.
The future was brought closer with a demonstration of quantum computing while the present was covered by the effective reporting capability from GA+, the way of modern programming an app in a hackathon, and the My LO solutions for internal and external users.
It was no accident that this futuristic event was held in Lombard Odier's historic headquarters. Throughout our 222-year history, we have continually reinvented ourselves to remain relevant and we have never shied away from adapting and using new technologies. That's particularly true of our digital innovation since 1957 – the year we first embraced the computer age.
Wichtige Hinweise.
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