The Global Credit Crisis: Implications for North American Wealth Management

The Global Credit Crisis: Implications for North American Wealth Management

As a result of the credit crisis, we shall see tectonic shifts in the way that investors think and behave with regard to their wealth, the products that they invest in, and the providers and channels with whom they do business going forward.

The credit crisis that began in the United States has rippled across the globe, upsetting financial systems and economies in almost every region and market. Wealth management across North America, until now the least affected segment of the financial services industry, is starting to undergo serious contraction. Investors are becoming more selective about which financial institutions they work with and the specific investment instruments they select.

In the new report, The Global Credit Crisis: Implications for North American Wealth Management, Celent discusses the likely outcomes of the current crisis on client segments, product providers, and manufacturers, as well as the products themselves.

To summarize the impact of the credit crisis on North American wealth management; everything that was certain and taken for granted is now being called into question.

Key findings of the report include:

ｷ Large providers have been adversely impacted; investors have an increased preference for independent firms and firms with pristine reputations

ｷ The product outlook across most asset classes is poor; client segments are responding differently to different product classes.

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Investor behavior is rapidly moving to extreme conservatism.

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Retirement accounts will grow as a social issue as they shrink in value.

ｷTechnology will provide a strategic advantage to providers as they seek to emerge from this crisis.

"Contraction in the North American economy due to the credit crisis has left an indelible mark on the way wealth management is delivered across financial institutions," says Robert J. Ellis, senior vice president of Celent’s Wealth Management practice and co-author of the report. "The entire financial services sector has been mauled, causing portfolios and retirement plans to hemorrhage value while requiring investors to question such basic issues as capacity for risk and planning for their retirement."

This report attempts to provide a perspective on the complexities the North American wealth management industry is facing as a result of the crisis.

The report is 27 pages and contains four figures and seven tables. The report’s table of contents is available online.

of Celent's Wealth Management research service can download the report electronically by clicking on the icon to the left. Non-members should contact info@celent.com for more information.