Like many executives in financial services, Alex Kerry, head of Winterflood Business Services, is an alumnus of Barclays Wealth. He worked in operations, and from this developed an appreciation of the importance of technology in improving the customer experience.
He said: "I've always been involved in change management and operations. I think for me, I've always been interested in technology improving efficiencies for customers. I've spent my career doing that.
"At Barclays Wealth I was in implementation and bringing the best of our technology to our customer base. If you're in a change management arena, it builds into technology. We've seen technology changing massively over the years and it's important to embrace that."
Platforms
WBS provides back office solutions to platforms such as Novia, which help drive the trading and settlement of asset purchases. As such, the company is in a good position to see the popularity of respective assets, and Mr Kerry said he has seen a dramatic change over the last few years.
He said the recent move from active to passive has been reflected in the transactions he has witnessed.
He said: "In terms of RDR, the adviser community has started looking at all assets classes, if they wanted to be a fully independent adviser, so demand started to stretch to get access to these, and the platforms started to see a need to offer these."
Mr Kerry has seen a move out of unit trusts and Oeics to ETFs and investment trusts. He said: "People are looking for yield, how do you do that today?
"Cash rates are low, bond yields are low, there are few alternatives. For advisers getting that yield for customers, you're starting to see yields from ETFs and investment trusts.
"Whereas advisers may have access to that before, we're trying to enable that access so that IFAs can service their clients more efficiently." Doing this involves allowing advisers to transact more efficiently through platforms that use his company's technology.
Trading
Winterflood Business Services is an offshoot of Winterflood Securities, a market maker based in the City, which offers prices to stockbrokers or platforms, providing them with trading capabilities; Mr Kerry said: "When you're trading online, you likely will be trading with Winterflood."
WBS came about through demand created by the RDR, with financial institutions asking for access to other asset classes such as ETFs. Mr Kerry joined in 2013, after working in Winterflood Securities and it became apparent that the company could offer its service to adviser platforms.
Mr Kerry said: "Our view was very much aligned to Winterflood Securities' view: let's see if we can achieve a better outcome by improving access and efficiencies. Technology is a real driver of that and helping our partners to take advantage of that in the new regime around RDR.
"We're thinking about the end consumer having better access and reducing costs. Consumer needs have changed radically. People want instant information, and they want transparency, not just in financial services. Financial services needs to keep up with the times."
One of the thing that WBS offers is options for lower-asset clients to have access to higher cost products. Mr Kerry said: "If someone wants to invest £25 a month, they can't do that with an ETF that's worth £150. We launched the ability to buy a slice, so if you want to invest £25 into four ETFs regardless of the size they are able to do so."
But another challenge looms on the horizon, which is MiFID II, which comes into effect in January 2018. This will have a big impact on platforms – clients of WBS. Mr Kerry said: "It's going to be interesting in terms of being able to innovate and make sure they're regulatorily compliant.
"There's a whole piece in MiFID II about fees and charges and suitability through the technological challenge to the product routes and asset managers; transactional reporting is going to change to the asset managers and that's a big structural change."
Best executions
The change that platforms will likely see is there is more onus on the platform to ensure "best execution" for the client. Mr Kerry said: "It is to make sure that the client orders are executed in the market in a regulatory-compliant way, to make sure the retail customer is getting the best outcome.
"Platforms have to do the analysis to find out whether they have the capability or not. If they deem it to be non-core, they need to outsource it.
"For advisers they need to look at their proposition and work out how better to service their retail client and make sure the platform is capable of meeting those needs, and if not then they should outsource to a third party like us."
Melanie Tringham is features editor of Financial Adviser
Career highlights
2013 to present: Head of Winterflood Business Services
2010 - 2013: Programme manager, business services at Winterflood Securities
2007 - 2010: Company director/owner, Ogilvie Search
2005 - 2007: Head of operational assurance for Channel Islands, Cyprus, Gibraltar and Cayman Islands at Barclays Wealth Management
2003 - 2005: Service improvement team & ops assurance UK Private Bank, Barclays
2001 - 2003: GTS Technical implementations, Citigroup
1998 - 2001: Treasury manager, Motorola
