Introduction to FigaroWealth 30th September 2009 John Blackman

Agenda Background Why are we here? History of Figaro Introduction to Figaro Market Trends The role of the relationship manager Figaro Desktop FigaroWealth Becoming a Figaro User

Background John Blackman Computing Science degree Joined John Hemming in 1985 One of the original authors MD since 1999 Target of sustained organic growth with continued investment into Figaro

Background Steve D’Souza Ex Odyssey Employed specifically to give JHC product advice on wealth management systems Launch Figaro Wealth

Background JHC History of steady growth Expansion through new clients and the success of our existing clients Investment in people is part of our business plan Future growth from relationships with outsourcers, particularly with TDWCSE, as well as direct clients

History of Figaro Figaro is driven forward by a core group of experts who have worked together for many years

Why are we here? Figaro has been the market leading fully integrated, comprehensive solution for stockbrokers for many years Following recent developments Figaro now has an integrated wealth management module that can compete in its own right with recognised wealth packages Modelling, re-balancing, switching, performance monitoring and risk analysis This is based around a proven back-office system We believe that, particularly in the present market conditions, a fully functional real-time integrated solution offers considerable benefits both to our users and particularly their clients

Introduction to Figaro Fully integrated Back office/Front office/Web True STP – one database, not just messaging Real-time trading and settlement processing Wrap platform Multi –product management Full asset coverage International processing Global settlement Global custody True multi-currency STP Scalable <100 – 50,000+ transactions per day 15 – 1,500+ users FIGARO has been developed for over two decades by adding client-led functionality and embracing new technologies and is the leading platform in the UK broking market

Introduction to Figaro FIGARO utilises a single database to support a huge array of services for financial institutions Client database KYC, Relationship management, wrap platform support CRM Contact History, Event workflow, Document management, Outlook Integration (email) Wealth Management Portfolios & accounts Tax wrappers (ISA) Modelling, Re-balancing, Risk CGT, GIP compliant performance Figaro Web Clients and Advisors Enquiry & trading Order Management System Linked to UK RSPs and Order Books (SETS) Collective dealing and International dealing systems Workflow & MI Integrated STP Settlement links CREST/Euroclear, Cofunds, EMX, Fidessa, BBH, BoNY) Nominee Pooled or designated Auto reconciliation US tax support Corporate Actions Fully configurable with election support Automatic Euroclear integration Client Payments Ad hoc, standing orders, income distribution BACS, CHAPS & cheques Auto bank reconciliation Fees Invoice system with pre-list Custody, management, ad hoc

Figaro – Why is it unique? Real time integrated system – Means that there are no interfaces to write or maintain, no reconciliations between systems. Single licence agreement for entire solution simplifies the transition process and also the long term relationship, since the support for regulatory changes is included. All original authors still support the system allowing major enhancements (such as Euroclear Single Platform) to be integrated without detriment to the system Figaro provides full unit trust support Integrated Order management and bulk dealing Direct access to RSPs via Best Execution servers SETS integration (ProQuote & Thomson) Fidessa (Executed trades)

Market Trends Change in profile of Figaro users 2005 2009

Market Trends Figaro clients changing their service models Broker was friend, stock-picker and commission based Mrs Miggins Stockbroker

Market Trends Figaro clients changing their service models Now firms offer a more integrated solution to wealth management Miggins Family Sales Team Relationship Manager Investment Committee

Market Trends Stock market perfomance Pressure from FSA Equities  funds and financial products Pressure from FSA Conformance to mandate and risk analysis Relationship with IFAs especially now due to RDR No trail! Trend towards annual management charge or wrap charge Convergence of service requirements Family Miggins gets same service as UNW clients However following funds (with baskets of stock in them) in the good times keeps the client happy and is easy – who knows whether that will work in the next few years?

The Role of the Relationship Manager Making Mrs Miggins feel special Just like the good old days! Checking that her assets are in line with her wishes Performance & risk Clear & concise reporting, annual reviews Proposing new products Transparent fee structure Figaro clients are offering a private banking style service  Figaro desktop

A day in the life of the wealth manager CRM Check all client communications Send letters & email Actions & workflow Chase up outstanding tasks Risk Check that portfolio is still within accepted risk boundaries Monitor asset allocation to model Make changes to model strategy Portfolio Management Respond to changes from the Investment Committee Modelling & Switching

Figaro Desktop “Home page” for relationship manager CRM Actions and workflow Relationships Marketing tool Integrated with MS Word and email

Figaro Desktop Integrated with Figaro front office for Detailed client enquiries Real time valuations and cash statements Modelling comparisons Order entry and management CGT Cash & client payments

Figaro Wealth- Toolset Asset allocation framework to contain the strategy required Model creation within the framework and application to a number of clients Monitor for exceptions Bring clients back in line allowing for special considerations such as CGT or stock preferences The firm’s advice might change and the relationship manager needs to be able to quickly and simply switch between stocks Provide performance analysis GIPs compliant reporting e.g. time-weighted returns Risk weighted Execute the resulting trades in real time Bulk trading Pre-trade checks

Figaro Wealth - Framework Multiple frameworks allowed Decided by wealth manager or investment committee Asymmetric allocation Can be used for a number of models

Figaro Wealth - Modelling Create model within framework Allocate actual assets within the hierarchy and show when assets satisfy the framework

Figaro Wealth – Linking clients to the model Multiple work sets , may be shared between relationship managers Select by product, relationship manager Multiple product support Quantity or £ value

Figaro Wealth – Re-balancing Detail for each client Client or product level Ticks and crosses to show degree of imbalance Model view shows actual and target % at each level of the hierarchy Validated candidate orders displayed using Figaro pre-trade checks Released as bulks to Figaro Order Management system

Figaro Wealth – Switching Multiple worksets Choose by relationship manager Select stock to switch out of Multiple stocks to switch into Take previous holdings into consideration Generate bulks depending on assets class Minimum order size Generates candidate orders in real-time with pre-trade checking ready for release in to Figaro OMS

Making it easier to become a Figaro user! Consultancy JHC have many years of experience in planning and managing clients onto the Figaro platform Training JHC have a dedicated training department who show users how to perform their roles on the new system Migration Standard processes and routines used many times each year Client data, transaction history and open positions

And now the slide you have all been waiting for.. Figaro is a proven solution that is being developed continually to ensure that our clients can provide a market leading service Figaro Wealth will provide innovative wealth management tools integrated to a market leading platform The integrated, comprehensive solution reduces the cost and complexity of the IT required and it may be outsourced Simple commercial and contractual arrangements lead to long lasting partnerships JHC supports the entire migration process and has a proven track record of delivering client service

Introduction to FigaroWealth 30th September 2009 John Blackman