Asset managers warned to cut costs as outlays rise 8% in 2017

A D2C 'Amazon-type marketplace' biggest concern

Changing market conditions and the withdrawal of central bank liquidity mean asset managers must address their costs in order to survive, according to research conducted by Morgan Stanley and consultancy firm Oliver Wyman.

The report said the ability to cut costs was becoming an increasingly important value driver with the industry making little progress last year. In 2017, absolute costs rose 8% as a result of increasing wage bills, new investments and regulatory outlays. Furthermore, the introduction of MiFID II is another factor anticipated to drive expenditure increases as asset managers take on the cost of sell-side research. Increased regulation 'stifling' asset managers'product innovation Betsy Graseck, equity analyst at Morgan Stanley, said: "Address costs now. Costs have not been contained, ...