Are you an independent wealth manager struggling to manage the assets of clients booked at multiple banks? Do you lack proper multi-data interfaces, or are you fed up with the never-ending account opening process? We may want to strive for the use of an omnibus account with segregated subaccounts!
Using omnibus accounts with segregated subaccounts is an accepted practice in specific local jurisdiction ecosystems such as the UAE and Singapore, but not in Switzerland.
Being treated as an institutional client can even reduce custodian bank costs, resulting in higher fees for the independent wealth manager and the client, focusing on one standardised SWIFT-like interface.
Maximising Efficiency with Omnibus Accounts
Working with a reputable bank or custodian that ensures strong security measures is crucial to protect your client’s assets. However, using an omnibus account provider might limit your ability to leverage a well-known private bank’s brand. Additionally, you can quickly open client accounts once your internal compliance and management approve. This approach bypasses the lengthy onboarding process of large private banks. Additionally, no KYC information is shared, which further streamlines the process.
However, an omnibus account, like a correspondence or global custody bank, poses a significant challenge for independent wealth managers, especially with tax reporting. Wealth managers must manage this task since the custodian bank lacks client information. Fortunately, a growing industry has emerged to lighten this burden. Additionally, delivering a solid client experience may require producing detailed transaction advice, which could mean upgrading your portfolio management system or adopting a light banking application solution.
In summary, omnibus accounts with segregated subaccounts offer many benefits to independent wealth managers. These include access to institutional investment opportunities, better fee schedules, potential cost savings, and simplified account opening processes. However, challenges remain. It would be ideal if independent wealth managers in Switzerland could also rely on this approach.
Source: LinkedIn (SEO adjusted)
