Rising regulation squeezes wealth managers’ profits

Ballooning regulation has wealth managers scrambling to keep pace with changes and allocating an ever-growing portion of their budget to cover compliance costs.

Wealth managers in the Americas are now spending a quarter of their operating budgets on compliance costs according to a report by consultancy Capgemini and RBC Wealth Management a unit of Royal Bank of Canada.

In Asia, the regulatory burden has swollen to a similar proportion said RBC Wealth Management’s Asia head Andrew Turczyniak at a conference in Hong Kong on Wednesday.

Hefty compliance costs are partially offsetting the profits to be made from servicing the world’s swelling ranks of millionaires....