✅ Lloyds Hopes To Shore Up Its Digital Wealth Tech With £390m Embark Acquisition
For our first digest, Lloyds customers may be investing £10 billion elsewhere, but they are looking to capture a share of those funds with their latest acquisition. Lloyds is looking to overhaul its famously tech-unsavvy Scottish Widows retirement savings arm as well as its investment offering. The British firm recently snapped up a fast-growing digital wealth group — Embark. This was a shrewd move by Lloyds seeing as how Embark already has 410,000 consumer clients and £35 billion of assets under management. Embark will be used to re-platform its pensions and retirement offerings, as well as continue to support Embark’s DIY wealth platform for Lloyds’ consumers. The deal, worth £390 million, and still subject to regulatory approval, does not include Embark’s Rowanmoor SIPP and SASS administration business. One of Embark’s existing investors, fintech investor Chrysalis, told its shareholders that the sale will result in an estimated return of around 63%. Richard Watts, a co-portfolio manager at Chrysalis, mentions how Embark has grown materially since their first investment. Nowadays, Watts adds, it is now one of the UK’s fastest-growing digital retirement and savings businesses. For Lloyds, the bank said it needs to meet more of its customers’ broader financial needs — hence the acquisition. This is an unsurprising move as traditional banks are scrambling to compete with newer digital platforms when it comes to meeting their customers’ needs.
✅ Wealth Accumulation Shifts From East To West
Our second digest focuses on how North America has once again reclaimed the top spot for global wealth creation. According to the World Wealth Report 2021, Asia-Pacific’s reign as the leading region for high-net-worth individuals has come to an end. In spite of the Covid-19 pandemic, the HNWI population overall rose by 6.3% and its combined wealth grew by 7.6% over the course of 2020. Because of this, North America overtook Asia-Pacific with a 10.7% increase in HNWI population and 11.9% in wealth. In addition, North America accounted for 55% of the more than 1.2 million new HNWIs added to the global pool, as well as contributing 46% of the global wealth growth. The report also showed that HNWIs have become more involved with their investments, enabled by new fintech providers. According to the report, 72% said they have invested in cryptocurrencies and 74% in other digital assets, such as website domain names or apps. Special purpose acquisitions companies, or SPACs, are also becoming popular among this new breed of HNWIs. It comes as no surprise that the WWR results indicate how quickly the wealth management arena is transforming. If you want your firm to leverage off of this transformation rather than get left behind by it, having more modern solutions at your disposal is essential One such solution is Bambu Build, a customer robo advisor solution built to your exact requirements and specifications for your customers and advisors. After all, these new HNWIs want to use tools like this, as we mentioned, to become more involved with their investments.