UBS changes how it calculates advisory fees

A sign sits on display outside a UBS Group AG bank branch in Worb, Switzerland, on Wednesday, July 15, 2020. U.S. President Donald Trump’s trade war with China is spurring UBS’s $2.2 billion multi-strategy hedge fund to make its biggest push yet into the Asian nation. Photographer: Stefan Wermuth/Bloomberg
A sign sits on display outside a UBS bank branch in Worb, Switzerland, on July 15, 2020.
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Starting with the fourth quarter, UBS will calculate advisory fees on an average daily account basis rather than quarterly.

The amended billing follows similar changes at other big brokerages. Last year, Morgan Stanley switched to monthly billing.

UBS is able to make the switch in part due to technology advances.

“Twenty years ago, the amount of data we would have needed to do this for every account every day would have been prohibitive. But the cost for doing that has come down dramatically,” says Steve Mattus, head of advisory and planning products. He adds that the changes will improve transparency for advisors and clients.

The changes are part of the company’s multiyear overhaul of its technology platform in partnership with Broadridge Financial Solutions. The wirehouse has been redesigning and updating core systems, some of which date back to PaineWebber, which UBS bought in 2000.

“This is the first very visible piece of what we are doing with Broadridge more broadly,” says Jeanne Andreana, head of digital strategy and platforms at UBS Wealth Management.

UBS fields more than 6,400 advisors in its Americas wealth management business, according to the company’s second-quarter earnings report. The Americas business has client assets of $1.4 trillion.

Broadridge Financial, a technology and communications company, has been expanding further into servicing the wealth management marketplace. Last year, it bought Fi360, a provider of fiduciary services and training to advisors.

“Technology and innovation are transforming wealth management, creating a better client and advisor relationship,” says Michael Alexander, head of wealth at Broadridge, in a statement.

“We are honored to be partnering with UBS to deliver our next-generation wealth platform, leveraging the latest in technology to enhance the wealth management client experience, provide greater transparency and more customized service and advice,” Alexander said.

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