Introduction to FigaroWealth 30 th September 2009 John Blackman.

Introduction to FigaroWealth

30th September 2009John Blackman

Agenda• Background• Why are we here? • History of Figaro• Introduction to Figaro• Market Trends• The role of the relationship manager• Figaro Desktop• FigaroWealth• Becoming a Figaro User

Background• John Blackman

– Computing Science degree

– Joined John Hemming in 1985

– One of the original authors

– MD since 1999– Target of sustained

organic growth with continued investment into Figaro

Background• Steve D’Souza

– Ex Odyssey– Employed specifically to give

JHC product advice on wealth management systems

– Launch Figaro Wealth

Background• JHC

– History of steady growth – Expansion through new

clients and the success of our existing clients

– Investment in people is part of our business plan

– Future growth from relationships with outsourcers, particularly with TDWCSE, as well as direct clients

History of Figaro

Figaro is driven forward by a core group of experts who have worked together for many years

Why are we here?• Figaro has been the market leading fully integrated,

comprehensive solution for stockbrokers for many years• Following recent developments Figaro now has an integrated

wealth management module that can compete in its own right with recognised wealth packages– Modelling, re-balancing, switching, performance monitoring and risk

analysis

• This is based around a proven back-office system• We believe that, particularly in the present market

conditions, a fully functional real-time integrated solution offers considerable benefits both to our users and particularly their clients

Introduction to Figaro• Fully integrated

– Back office/Front office/Web– True STP – one database, not just messaging– Real-time trading and settlement processing

• Wrap platform– Multi –product management– Full asset coverage

• International processing– Global settlement– Global custody– True multi-currency– STP

• Scalable– <100 – 50,000+ transactions per day– 15 – 1,500+ users

FIGARO has been developed for over two decades by adding client-led functionality and embracing new technologies and is the leading platform in the UK broking market

Introduction to FigaroFIGARO utilises a single database to support a huge array of services for financial institutions

• Client database– KYC, Relationship management, wrap

platform support• CRM

– Contact History, Event workflow, Document management, Outlook Integration (email)

• Wealth Management – Portfolios & accounts– Tax wrappers (ISA)– Modelling, Re-balancing, Risk– CGT, GIP compliant performance

• Figaro Web– Clients and Advisors– Enquiry & trading

• Order Management System– Linked to UK RSPs and Order Books

(SETS)– Collective dealing and International

dealing systems• Workflow & MI

• Integrated STP Settlement links • CREST/Euroclear, Cofunds,

EMX, Fidessa, BBH, BoNY)• Nominee

• Pooled or designated• Auto reconciliation• US tax support

• Corporate Actions• Fully configurable with election

support• Automatic Euroclear integration

• Client Payments• Ad hoc, standing orders, income

distribution• BACS, CHAPS & cheques• Auto bank reconciliation

• Fees• Invoice system with pre-list• Custody, management, ad hoc

Figaro – Why is it unique?• Real time integrated system – Means that there are no

interfaces to write or maintain, no reconciliations between systems.

• Single licence agreement for entire solution simplifies the transition process and also the long term relationship, since the support for regulatory changes is included.

• All original authors still support the system allowing major enhancements (such as Euroclear Single Platform) to be integrated without detriment to the system

• Figaro provides full unit trust support• Integrated Order management and bulk dealing

– Direct access to RSPs via Best Execution servers– SETS integration (ProQuote & Thomson)– Fidessa (Executed trades)

Market Trends• Change in profile of Figaro users

2005 2009

Market Trends• Figaro clients changing their service models

– Broker was friend, stock-picker and commission based

Market Trends• Figaro clients changing their service models

– Now firms offer a more integrated solution to wealth management

Market Trends• Stock market perfomance

– Equities funds and financial products

• Pressure from FSA – Conformance to mandate and risk analysis

• Relationship with IFAs especially now due to RDR– No trail!

• Trend towards annual management charge or wrap charge• Convergence of service requirements

– Family Miggins gets same service as UNW clients

• However following funds (with baskets of stock in them) in the good times keeps the client happy and is easy – who knows whether that will work in the next few years?

The Role of the Relationship Manager• Making Mrs Miggins feel special

– Just like the good old days!

• Checking that her assets are in line with her wishes– Performance & risk

• Clear & concise reporting, annual reviews• Proposing new products• Transparent fee structure

• Figaro clients are offering a private banking style service Figaro desktop

A day in the life of the wealth manager

Figaro Desktop• “Home page”

for relationship manager

• CRM

• Actions and workflow

• Relationships • Marketing tool• Integrated with MS Word and email

Figaro Desktop • Integrated with Figaro front office for– Detailed client

enquiries– Real time

valuations and cash statements

– Modelling comparisons

– Order entry and management

– CGT– Cash & client

payments

Figaro Wealth- Toolset• Asset allocation framework to contain the strategy required• Model creation within the framework and application to a number of

clients• Monitor for exceptions• Bring clients back in line allowing for special considerations such as

CGT or stock preferences• The firm’s advice might change and the relationship manager needs to

be able to quickly and simply switch between stocks • Provide performance analysis

– GIPs compliant reporting e.g. time-weighted returns– Risk weighted

• Execute the resulting trades in real time– Bulk trading– Pre-trade checks

Figaro Wealth - Framework• Multiple

frameworks allowed

• Decided by wealth manager or investment committee

• Asymmetric allocation

• Can be used for a number of models

Figaro Wealth - Modelling• Create

model within framework

• Allocate actual assets within the hierarchy

• and show when assets satisfy the framework

Figaro Wealth – Linking clients to the model

Multiple work sets , may be shared between relationship managers

Select by product, relationship manager

Multiple product support

Quantity or £ value

Figaro Wealth – Re-balancingDetail for each client

Client or product level

Ticks and crosses to show degree of imbalanceModel view shows actual and target % at each level of the hierarchy

Validated candidate orders displayed using Figaro pre-trade checksReleased as bulks to Figaro Order Management system

Figaro Wealth – Switching Multiple worksets Choose by relationship manager

Select stock to switch out ofMultiple stocks to switch intoTake previous holdings into consideration

Generate bulks depending on assets classMinimum order sizeGenerates candidate orders in real-time with pre-trade checking ready for release in to Figaro OMS

Making it easier to become a Figaro user!

• Consultancy– JHC have many years of experience in planning and managing clients

onto the Figaro platform

• Training– JHC have a dedicated training department who show users how to

perform their roles on the new system

• Migration– Standard processes and routines used many times each year– Client data, transaction history and open positions

And now the slide you have all been waiting for..

Figaro is a proven solution that is being developed continually to ensure that our clients can provide a market leading service

Figaro Wealth will provide innovative wealth management tools integrated to a market leading platform

The integrated, comprehensive solution reduces the cost and complexity of the IT required and it may be outsourced

Simple commercial and contractual arrangements lead to long lasting partnerships

JHC supports the entire migration process and has a proven track record of delivering client service

Introduction to FigaroWealth

30th September 2009John Blackman