Digitizing Wealth Management: Trends, Challenges and Business Opportunities

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1 Digitizing Wealth Management: Trends, Challenges and Business Opportunities Anthony Perkins Executive Vice President Technology Product Development Member FINRA/SIPC 1

2 Agenda About LPL Financial LPL s Digital Transformation Journey Digital Transformation with Appway 2

3 About LPL Financial We believe objective financial guidance is a fundamental need for everyone. We enable our clients to focus on what they do best create the personal, long-term relationships that are the foundation for turning life s aspirations into financial realities. 3

4 About LPL Financial Nation s largest independent broker-dealer for 20 consecutive years 1 Fifth largest brokerage firm in the U.S. by number of financial advisors 2 Number one provider of third-party brokerage services to banks and credit unions 3 Fastest growing RIA custodian We serve 14,000+ financial advisors, 700+ financial institutions (banks and credit unions), 4,400+ financial advisors licensed with insurance companies More than 4.5 million funded accounts Our platform provides proprietary technology, comprehensive clearing and compliance services, practice management programs, and independent research 3,300+ employees, with primary offices in Boston, Charlotte, and San Diego 1 Financial Planning magazine , based on total revenues 2 Based on publicly filed information as of September 30, Based on the number of financial institutions served as reported in the 2013/2014 Kehrer Saltzman & Associations TPM Report Note: As of Dec. 31, All data is based on the most recent information available; more current data may alter the claim. 4

5 LPL Financial: Who We Serve LPL is the leading financial services provider to independent advisors, RIAs, and financial institutions. We tailor our programs and services to the needs of our distinct customer groups to allow advisors to deliver truly objective, independent financial advice. Our flexible business model allows us to serve a broad range of clients, including: Independent financial advisors and RIAs Advisors and program managers affiliated with insurance companies Banks and credit unions Retirement plan advisors Trust companies LPL makes meaningful investments to support the growth, productivity, and efficiency of advisors across a broad spectrum of models as their practices evolve. We are focused on working alongside advisors through complex environments in order to create the best outcomes for investors. 5

6 Charting Our Performance 6

7 Combined Capabilities = Differentiation Technology Practice Management Research Serving Main Street with Independent Advice Risk Management 7

8 LPL Digital Transformation The digital transformation at LPL is reshaping every aspect of our business model and designed to speed the time to market with new products and solutions that provide customized client experiences and enable a high-degree of operational efficiency. Data Driven Insights Robust Customer Experience BEING DIGITAL Increased Automation 8

9 Increased Demand for Technology Clients have higher expectations than ever before and therefore crave meaningful touches each year from their advisor. To support this, there is a greater need for technology & automation: Aggregation of direct and brokerage business Integration of technology components Straight-through processing in a paperless environment Electronic account opening, trading and settlement (direct, brokerage, and advisory) Mobile application and access for client and advisors Support of Social Media 9

10 What led LPL Financial to Appway? Empower Advisors and office staff Cash Management Account Opening Account Servicing Transfers Integrated experience Reduced end-to-end cycle times and Not-In-Good-Order (NIGO) occurrences Do business anywhere on any device Streamlined efficient workflows replace the current form centric model Predictable, Automated, and Transparent Controls Increased straight through processing Current status of requests without phone calls Rules engine A unified platform and one stop shop for all users Drive change at a rapid pace - to stay ahead in the digital age 10

11 Digital Transformation Journey With Appway Today Driving productivity Streamlined processes Eliminating re-keying of data Automation of manual activities Empowering advisors Real time collaboration Guided wizard approach Fully mobile ready Increased digital channels to empower advisors Enabling rapid feedback, change and deployment Faster development cycles Agile methodology Today we empower the advisor, so that tomorrow we can better serve the client 11

12 Digital Transformation Journey With Appway Tomorrow Unified platform One stop shop for advisors Staying ahead of compliance DOL Better Serving Clients Enabling self service for end users Multiple channels Self servicing Full servicing Joint servicing Today we empower the advisor, so that tomorrow we can better serve the client 12

13 Digital Transformation Journey With Appway New Account Opening 80% of all use cases (summer 2016) Straight through processing Document generation and population E-Signature Business Activity Monitoring Multi-browser, multi-device Guided wizard approach (Selective disclosure to reduce NIGO) Roadmap Remaining 20% use cases DOL / Compliance Account maintenance Account transfers Cash management Service professional desktop Service Request/Request Grid Unified portal for employees to access transactions from multiple applications, platforms, providers 13