![]() The PWC survey also highlights the trend around the consolidation of companies. To complete that scale, companies can then turn to M&A for consolidation. Bain reports that when a company shifts from a traditional to a digitally enabled wealth management model, returns to scale can be up to 35% higher (because of lower variable costs in a digitally enabled model). ![]() As the largest wealth managers outpace the market, scale benefits will become even more apparent since players will have to make significant investments in tech and data/analytics to provide differentiated client experiences. ![]() While they expect to see a smaller share of “ scale” deals valued at $1 billion or greater, they predict a significant increase in “ scope” deals, especially those made to gain digital capabilities, expand offerings and ecosystems, and continue vertical integrations.īetween now and 2030, Bain expects continued scale activity for wealth management companies, heightened by technology. Other companies have been turning to M&A to enable vertical integration, demonstrated by Schroders’ recent acquisition of Benchmark Capital.Įarlier this year in their report “M&A in Wealth and Asset Management: How Deals Will Shake Up the Industry,” Bain highlighted both scale and scope M&A trends to capture growth opportunities. Goldman Sachs took a step in this direction last year when it announced it would internally unify its asset and wealth management areas back together under one business. One emerging model for asset growth centers upon deeper vertical integration of the value chain-especially as asset and wealth management converge with the AI and other recent tech innovations.
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