ASWM Summit 2019 SAAM, Future of Independent wealth managers Vision - - PowerPoint PPT Presentation

ASWM Summit 2019

SAAM, Future of Independent wealth managers Vision & Facts Serge Pavoncello

ASWM Summit 2019

Introduction

Global environment since the financial crisis

… What about Switzerland?

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Quelle: ESVG 2010, Quartalsaggregate des Bruttoinlandprodukts, Produktionsansatz, unbereinigte Daten

Federal Budget

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Quelle: SNB

What about Finance?

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Quelle: Kennzahlen Finanzstandort Schweiz (BFS/SECO)

… and Independent Wealth Managers

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Quelle: Kennzahlen Finanzstandort Schweiz (SNB) und Jahresberichte des VSV

Environment since the financial crisis

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ASWM Summit 2019

SAAM (VSV, ASG)

Role and actions

SAAM’s role

By-laws of the SAAM Association ▪ Art 2 : Purpose

• To represent its members and their interests
• To reinforce the position and reputation of IWM
• To cooperate with the authorities in order to elaborate new rules
• Promote education
• Assist members in the resolution of professional problems

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SAAM’s role

Historical perspective – Milestones ▪ 1986 Creation of the Association ▪ 1987 First Code of conduct ▪ 1999 Self-regulatory organisation SRO ▪ 2012 First draft of the new financial law ▪ 2018 Finalization of the FIDLEG and FINIG ▪ 2019 Finalization of the FIDLEV and FINIV ▪ 2020 New laws and ordinances come into force Splitting of the association “Verband / SRO”

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FINIG - a long way to mould the future

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2008 2015 2014 2018 2009 2012 2011 2010

Lehman Brothers bankruptcy Preliminary works FINMA and Financial stake holders Consultation final vote June 2018

2016 2013 2017

FC: Mandate to the FDF Message

SAAM stand by me

• 1. Member’s representative

A professional association to support its members

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SAAM stand by me

Representation of interests by the SAAM ▪ Laws (reminder)

• The initial draft of the Federal Council would have induced the end of a

major part of the profession

• The SAAM was the unique association to fight against such a situation
• These options were the basis for the drafting of the FINIG
• The Parliament thus adopted a law compliant with the SME, that
• enables our members to continue their activities with good minimum

standards

• recognizes the wealth management and its supervision
• guarantees the titles «Vermögensverwalter / gestionnaire de fortune»

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Association SAAM SRO SAAM SRO SO-FIT

SAAM stand by me

Roadmap to the new environment. 2020 transition year

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2020: transfer of the SRO activities to the AO 2023 2022 2021

AO SO-FIT Universe AO

Full support of SAAM in the transfer process

SAAM stand by me

Representation of interests by the SAAM ▪ Draft / implementation of the new standard rules The SAAM is everywhere:

• 1. Finalization of the ordinances: meetings with FFD
• 2. Definition/Draft the regulation (standards) : meetings with FINMA
• Authorization’s request:
• Procedure
• Task’s allocation FINMA / AO
• Documentation for the request
• Pre-assessment by the AO
• System of « Rating »
• Risks classification
• Risks analysis (activities, organization, FINIG, AML, FINIG)
• Concepts of supervision and audit

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Last developments FINIG - FIDLEG

Representation of interests by the SAAM

• 3. Other actions:

Discussions/Negotiations with politics, SWA, other AO’s applicants, applicants to the Ombudsman (mediation), insurances, etc.

• Coordination, harmonization, standards, partnerships, etc.

▪ Creation and implementation of an AO ▪ Easy transfer from SRO to AO ▪ Solution for the Ombudsman (mediation)

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Last developments FINIG - FIDLEG

Actions from SAAM ▪ Legal support

• Guidelines/notices FIDELG/FINIG, check-list for authorization
• Documents (templates, directives, organizational regulations, etc.)
• Workshops, trainings
• News, updates, answers to your questions

▪ Training

• Solutions for requirements of continuing training

▪ Since 2020, the SAAM, the unique professional and branch association, will continue to represent, advise, support, train and inform its members ▪ The OA will not have the right to advise, support nor train the IWM

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Last developments FINIG - FIDLEG

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Legal calendar and transition rules ▪ The IWM and Trustees have until June 30, 2020 to announce themselves (sich melden) to FINMA and 6 months to register to an Ombudsman ▪ The rules of FIDLEG are applicable since January 1, 2020 but FIDLEG set out transition rules (generally 1 year) for the implementation of certain obligations ▪ The existing IWM have until December 31, 2022 to:

• adapt their organization to the new FINIG requirements
• affiliate with an AO
• file the request to FINMA

▪ For the new IWM, since 2020:

• affiliate to an AO and an Ombudsman
• file the request to FINMA
• start the activities after having received the FINMA’s authorization

Authorization request to FINMA Material conditions FINIG - FINIV

▪ Principle : 2 qualifizierte Geschäftsführer at least ▪ Also accepted : 1 qualifizierte Geschäftsführer if Business Management Continuity is guaranteed ▪ Requirements :

• Professional experience : 5 years in wealth management
• Training: equivalent to required experience needed to perform an

audit of IWM. ▪ SAAM opinion : 2nd condition is a nonsense, strong opposition and proposition of new drafting Employees : qualifications and experience in their field Two «Qualifizierte Geschäftsführer» / one-man company

• Art. 20 FINIG and art. 18 FINIV

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Authorization request to FINMA Material conditions FINIG - FINIV

▪ Board of Directors (art. 15 al. 5 FINIV): if annual gross income > 5 M, and if required by scope and type of activities.

• SAAM opinion : no legal basis, article to be removed

▪ Internal audit (art. 19 al. 3 FINIV): if annual gross income > 10 M, and scope and type of activities

• SAAM opinion: no legal basis, article to be removed

▪ Risk management and Compliance Independent (art. 19 al. 2 FINIV): if > 5 people or annual gross income > 1.5 M, and business model with a high risk rating.

• SAAM opinion: exception, solely a minority of IWM may be affected

(calculation of the thresholds to be specified) Independence

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Authorization request to FINMA Material conditions FINIG - FINIV

• Art. 21 FINIG and art. 19 FINIV

▪ Scope: risk management shall cover any activity and major risks shall be detected, assessed, updated and supervised ▪ Independence: reminder no requirement for an independent Risk Management / Compliance, under 2 conditions : not > 5 persons or not > 1.5 M annual gross income, and rating of business model as «no risk». ▪ Should the condition of independence be fulfilled, => Outsourcing is an

• ption

Risk management and Compliance

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Authorization request to FINMA Material conditions FINIG - FINIV

▪ Social capital minimum, art. 20 FINIV (art. 22 al. 1 FINIG)

• Minimum Capital of CHF 100’000.- in cash (postposed debt obligation,

taken into consideration)

• Guarantees or professional liability insurance

▪ Equity capital, art. 21 to 23 FINIV (art. 23 FINIG)

• at min. 25% of fixed costs, at maximum 10 M
• Are fixed costs under art. 23 al. 2 FINIG:

payroll (excl. bonus) and operating charges; amortizations; charges due to corrections of value, provisions and loss

▪ Guarantees, art. 24 FINIV (art. 22 al. 2 et 23 FINIG)

• No additional guarantees needed if EC requirements fulfilled
• Taken into consideration in the calculation of Equity Capital : 50% of

the professional liability insurance cover Financial requirements

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Authorization request to FINMA Material conditions FINIG - FINIV

▪ General rule, applicable for all (IWM and trustees) : Minimum thresholds per civil year (i.e. professional activity) :

> 50K gross income, or > 20 clients, or > 5M AuM, or > 2M of transactions

(copy of the thresholds already existing in art. 7 al. 1 AMLO) ▪ Exception : Activities performed exclusively for close people (i.e. economic or family ties) = single family office → out of FINIG/FINIV scope. ▪ By contrast : multi-family office or services rendered in favour to both close and non-close people → in FINIG/FINIV scope. ▪ Additional authorization needed (rethink the business model, secondary activities to pure WM) Type of activities - IWM vs Trustee / Family office

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SAAM stands by you

• 2. Lobby & Legal Support

Independent and neutral advice for Independent Wealth Managers

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SAAM stands by you

2020 and beyond ▪ Legal Support

• Guidelines/notices FINIG/FINLEG, check-list FINMA authorization
• Documents (templates, directives, organization regulations, etc.)
• Workshops, trainings
• AEOI
• FATCA
• Data protection

▪ News, updates, answers to your questions ▪ Since 2020, the SAAM, the unique professional and branch association, will continue to represent, advise, support, train and inform its members ▪ The OA will not have the right to advise, support nor train the wealth managers

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SAAM stands by you

Support from SAAM for you and in your day-to-day ▪ Representation of interests

• workshops Brexit
• view exchanges with economiesuisse, SGV-USAM, SVFB-USPL
• discussions with politics and media

▪ Ombudsman

• Included into the SAAM’s membership fee

▪ Relationships with depositary banks and business partners

• documents (templates of agreements, forms)
• manuals
• harmonization

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SAAM stands by you

• 3. Training

Pragmatic and efficient

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SAAM stands by you

Support from SAAM for you and in your day-to-day ▪ Training

• A system close to reality
• Qualified and trained actors
• Reliable actors

▪ Basis for the qualifizierte Geschäftsfürher

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SAAM’s Actions for the training

Acting for our members with a tailored-made training solution: ▪ National survey on qualification profile of the representatives of the SAAM members (2014) ▪ Launch of the VSV | ASG project for continuing training (2017) ▪ Creation of the VSV | ASG service for continuing training (2018) ▪ Definition of framework for the VSV | ASG continuing training (2018) ▪ Draft on the training of wealth managers and articles for FINIG (July 2018) ▪ Definition of professional profile and competences for wealth manager (2018) ▪ Development of the VSV | ASG continuing training platform (2018-2019) ▪ Creation of a network of training providers in the 3 regions (2018-2019) ▪ Meetings with FFD for the final draft of the ordinances (2018-2019)

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Platform for continuing training VSV | ASG

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Services/offers of SAAM’s continuing training

▪ Training platform for management of members trainings (5 fields : compliance, finance, tax, wealth management, risk and portfolio management). ▪ Validation and recognition of individual trainings with a «Berufszertifikat/ Branchenzertifikat» with «geschütztem Titel» (Qualified independent wealth manager VSV). ▪ Register of “Qualified independent wealth manager VSV”. ▪ Quality assurance :

• accreditation system of providers and trainings.
• scientific committee (representatives from academic and professional

world).

• expertise and minimum standards of qualification from the sector.

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Scientific committee

Field Expert Qualification

Tax

• Prof. Xavier Oberson
• Professor of Swiss and international tax laws,

UNIGE

• Partner of Oberson Abels Lawfirm

Finance/Wealth Management

• Dr. Falko Paetzold
• Founder & Managing Director, Center for

Sustainable Finance and Private Wealth, Universität Zürich Compliance Me Alexander Rabian

• President of the OA SAAM
• Partner of Streichenberg Lawfirm

Risk- and Portfolio Management

• Dr. Philippe Sormani
• Co-founder of AZEK
• Founder/BM-President IAZI AG

Economy/macro- economy

• Prof. Jan Egbert Sturm
• Professor in applied macroeconomy (D-MTEC),

ETH Zürich

• Director of the KOF Konjunkturforschungsstelle,

ETH Zürich.

President of Scientific committee : Serge Pavoncello, President of SAAM’s Board

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Providers of trainings (cluster)

✓ Selection of providers to launch the program

Academy & finance GE,ZH,LUG AZEK Bizzozero & partners brp Centro di studi bancari CSB CFA Society Switzerland Fintelligence IfFP, Institut für Finanzplanung Hochschule Luzern, Institut für Finanzdienstleistungen IFZ ISFB, Institut Supérieur de Formation Bancaire Genève Mendo PWC SECA, Association Suisse des Investisseurs en Capital et de Financement SIX Swiss Finance institute SFI Swiss finance institute EPFL (SWISS quote Conference) Universität St. Gallen Universität Zürich Université Genève, Geneva Finance Research Institute GFRI Università della Svizzera italiana USI Vision Compliance Zürcher Hochschule für Angewandte Wissenschaften ZHAW (School of management and Law) … 33

SAAM Stand by you

• 4. Services to members

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SAAM Stand by you

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Support from SAAM for you and in your day-to-day ▪ Solution to the obligation to be registered with an Ombudsman

• Pragmatic solution
• Costs included in the membership fee

▪ Various offers from external providers

• Measurements of performances / risks
• PMS Solutions
• Wealth Support / IT

SAAM, the new environment

▪ New membership fee: (CHF 2’000)

• Costs increase linked to the development of services to members
• The membership fee for individual member (CHF 500) remains free for

the employees of active members. Individual membership gives access to the SAAM’s continuing training plateform and the certification for qualifizierte Geschäftsführer according to FINIG.

• The mandatory Ombudsman registration (according information from

the media, between CHF 500 and 1’000) will be included in the membership fee of active member.

• The legal support shall clearly be increased during this period to meet

members needs ▪ The AO’s will not be authorized to support nor train the supervised

• entities. Only a professional association could play this role.

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Your are welcome to build with us the future of the SAAM!

SAAM, the new environment

Legal Support Services and Outsourcing Training Advocacy

GFI

SAAM supporting the future of the Independent Wealth Managers