Category: Wealth ManagementJapan

Use of Multiple Channels to Access Investment Services Increases; Number of Investors with an Assigned Investment Advisor Also Increases

2015-07-17

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TOKYO: 1 July 2015—The number of investors who access financial institutions through multiple channelshas increased and half of investors have been assigned a dedicated investment advisor,according to the JD Power Asia Pacific 2015 Japan Investor Satisfaction Study^SM released today.

The study, now in its fourth year, measures investor satisfaction with investment firms in six factors (listed in order of importance): account offerings (32%); account information (22%); interaction (22%)—which includes three subfactors: advisor, online services and call center—trading charges and fees (19%); facilities (4%); and problem resolution (1%). The study categorizes financial institutions into five segments based on their business model: full-service securities; self-directed securities; full-service national banks; self-directed banks; and full-service regional banks. Data is also collected on trust banks for reference purposes only.

Half (50%) of investors who use securities companies or banks indicate they have been assigned an advisor, up from 40 percent in 2012. The rate of increase is particularly high among investors who use banks, with satisfaction also increasing among these investors.

“One reason for the increase in assigned investment advisors is that financial institutions are focusing on improving satisfaction and increasing profits in the asset management business by placing greater emphasis on an investment advisor-driven customer approach,” said Ryutaro Nakao, manager at JD Power Asia Pacific, Tokyo. “For example, opportunities for advisors to visit investors have increased as have the actual number of contacts pertaining to the trading of investment products or investment advice.”

Percentage of Individual Investors Who Have Financial Advisors                           

                                                                2012                     2015

Overall                                                    40%                      50%

Full-Service Securities                           42%                      50%

Full-Service National Banks                  29%                      42%

Full-Service Regional Banks                 37%                      50%

Trust Banks                                             51%                      63%

The percentage of investors who have received more than one visit from an investment advisor during the previous 12 months has increased to 46 percent from 40 percent in 2012. 

More than one-third (36%) of investors obtain advice when deciding which investment products to purchase. However, only 27 percent of investors indicate their advisor thoroughly understands their approach to investing or their tolerance for risk.

According to Nakao, “Although some investors understand that they are ultimately responsible for their investment decisions, the reason they choose full-service financial institutions instead of self-directed securities companies or banks is to obtain valuable advice. Financial institutions need to develop relationships of trust so that investors consider advisors to be professionals in whom they can confidently entrust their investment decisions.”

While the number of independent financial advisors (IFAs) not affiliated with specific securities companies has gradually increased in Japan, awareness of their existence has not increased, with only 34 percent of investors aware of IFAs. The increase in the number of IFAs is likely to help create an atmosphere in which investors entrust their investment decisions to advisors. 

The use of financial institutions’ Web-based services by investors for activities via smartphones, tablets and other mobile devices has steadily increased. This trend is particularly pronounced among investors 50 years and younger at self-directed securities companies, many of whom use tablets and smartphones to confirm market conditions, gather information and make trading transactions. Compared to personal computers, the advantages of mobile devices are that they are easy to use and may provide shorter wait time as they provide simplified logins and menus. However, more than 90 percent of investors using a mobile device also use a personal computer. In many cases, mobile devices are used as a back-up in specific situations. Additionally, the use of tablets by investment advisors to provide more timely and prompt guidance is positively impacting satisfaction.

Percentage of Investors Who Use a Mobile Device                              

                                                                2014                     2015

Tablets                                                     10%                      14%

Smartphones                                           15%                      21%

 More than one-third (36%) of investors use financial institution branches and offices in 2015, compared with 39 percent in 2014. Although investors are increasingly using advisors, they have begun to selectively use full-service and self-directed channels, findings that are similar to those in the JD Power 2015 U.S. Self-Directed Investor Satisfaction Study.^SM The distinction between the financial advisory services of self-directed institutions and those of full-service institutions is expected to become increasingly blurred in Japan over time. Accordingly, for financial institutions, further enhancement of investor convenience through multi-channel and multi-device support is likely to become a requirement for retaining individual investors as customers.

Overall Satisfaction Rankings by Segment

Full-Service Securities Segment (10 companies ranked)

Nomura Securities (549) ranks highest in investor satisfaction for a fourth consecutive year, performing particularly well in the account offerings factor and advisor subfactor. SMBC Nikko Securities (545) ranks second, performing particularly well in the account information and trading charges and fees factors.

Self-Directed Securities Segment (five companies ranked)

SBI SECURITIES (576) ranks highest in investor satisfaction for a fourth consecutive year, performing particularly well in the account offerings and account information factors. Matsui Securities (573) ranks second, performing particularly well in the trading charges and fees factor and online services subfactor.

Full-Service National Bank Segment (five banks ranked)

Resona Bank (562) ranks highest in investor satisfaction for the first time, performing particularly well in the trading charges and fees and facilities factors. Sumitomo Mitsui Banking Corporation (561) ranks second, performing particularly well in the call center subfactor. Bank of Tokyo-Mitsubishi UFJ (555) ranks third, performing particularly well in the online services subfactor.

Self-Directed Bank Segment (seven banks ranked)

SBI Sumishin Net Bank (589) ranks highest in satisfaction for a fourth consecutive year, with a particularly high score in trading charges and fees. Sony Bank (578) ranks second, performing particularly well in the account offerings factor and call center subfactor.

Full-Service Regional Bank Segment (34 banks ranked)

Suruga Bank (580) ranks highest in the segment for the first time, performing particularly well in trading charges and fees. Toho Bank (573) ranks second, performing particularly well in the facilities factor and advisor subfactor. Nanto Bank (570) ranks third, performing particularly well in the account offerings factor.

The 2015 Japan Investor Satisfaction Study is based on responses from 18,115 individual investors in Japan who are at least 18 years old and who have used investment services—such as investment trusts, stocks, foreign currency deposits and foreign exchange—at private banks and securities companies in the past year. The study was fielded in May 2015.

Media Relations Contacts

Shizue Hidaka; JD Power Asia Pacific; Metro City Kamiyacho. 8F; 5-1-5 Toranomon; Minato-ku, Tokyo; Japan 105-0001; Phone +81-3-4550-8060; [email protected]

John Tews; Director, Media Relations; JD Power; 320 E. Big Beaver; 5^th Floor, Suite 500, Troy, MI, 48083 USA; 001 248-680-6218; [email protected]

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at japan.jdpower.com.

About JD Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info

About McGraw Hill Financial www.mhfi.com 

 

Investor Adoption of Nippon Individual Savings Account (NISA) is Limited; Tablet Use Is Increasing among Financial Institutions and Investors for Effective Communication

2014-08-12

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TOKYO: 1 July 2014 — Investor adoption of the Nippon Individual Savings Account (NISA) remains small, with only 48 percent of current investors having opened an NISA account while tablet use is increasing   among financial institutions and investors to communicate information about the NISA program or other investment products, according to the JD Power Asia Pacific 2014 Japan Investor Satisfaction Study^SM released today.

The study, now in its third year, measures investor satisfaction with investment firms in six factors (listed in order of importance): account offerings (32%); account information (22%); trading charges and fees (20%); interaction (21%); The study categorizes financial institutions into five segments based on their sales business model: full-service securities; self-directed securities; full-service national bank; self-directed bank; and full-service regional bank. Data is also obtained on trust banks for reference purposes.

The study finds 93 percent of current investors are aware of NISA in 2014, compared with 63 percent in 2013. However, only 48 percent of investors have opened an NISA account. Investors 60-years and older have the highest rate of opening an NISA account (60%), while investors 49 and younger have the lowest rates (less than 40%).

The study also finds that nearly half (48%) of investors cite pamphlets and other paper-based materials as the most frequent source of sales support tools used by investment advisors. In comparison, the use of tablets as a sale tool has increased to 5 percent for the industry overall, with more than 10 percent usage at some securities companies and banks.

Investment advisors can provide more time to explain the investment environment and market conditions with investors, answer questions and provide consulting services in presentations in which tablets are used, compared with negotiations in which paper-based materials are used. Moreover, satisfaction is higher when tablets (612) are used than when other means of sales support tools are  used such as PCs (586), paper-based material (569) and without any material (541). This finding indicates that using tablets not only for product explanations, but also for explaining and responding in real time to investor needs and questions about current market conditions, contributes to higher levels of satisfaction through the flexibility provided by tablets in offering effective and timely presentations.

“Account opening rates are particularly low among company employees and government workers, who are comparatively cautious investors with a strong tendency to avoid investment risks,” said Ryutaro Nakao, manager at JD Power Asia Pacific, Tokyo. 

The study finds among investors who have not opened a NISA account, that they have not done so because they believe opening an account is bothersome and takes too much time. Many of the investors who have a NISA account express some frustrations with investing in NISA such as: the annual maximum investment limit is low; there are few investment products; the tax-free period is short; and change financial institutions is slow.

KEY FINDINGS

• The study finds that 6 percent of investors are new, having begun investing during the previous 12 months, which is roughly the same level as in 2013. This indicates that the introduction of the NISA system in 2014 has not yet had a significant effect in increasing the number of investors.
• ŸThere are substantial differences among the financial institutions across the five segments in of the rate of new account openings, ranging from 30-70 percent. Account opening rates are higher among banks and securities that achieve high satisfaction scores.
• ŸThe contact channels used by investment firms are shifting, and the use of tablets is becoming an increasingly important differentiator among financial institutions in terms of investor satisfaction. Individual investors are increasingly using tablets for investment-related activities, with 13 percent of them using this device to access Web-based services of the financial institutions where they invest. In particular, many high-income male 59 years and younger use tablets to confirm market conditions; gather information on investment products; and trade.

Overall Satisfaction Rankings by Segment

Full-Service Securities Segment (Five Companies Ranked)

Nomura Securities ranks highest in investor satisfaction for a third consecutive year with a score of 546, performing particularly well in the interaction factor. Daiwa Securities ranks second with a score of 534 and SMBC Nikko Securities ranks third at 532.

Self-Directed Securities Segment (Six Companies Ranked)

SBI SECURITIES ranks highest in investor satisfaction for a third consecutive year with a score of 581. SBI SECURITIES performs particularly well in the account information factor. Matsui Securities ranks second (579) and GMO CLICK Securities ranks third (578).

Full-Service National Bank Segment (Five Banks Ranked)

Sumitomo Mitsui Banking Corporation ranks highest in investor satisfaction for a third consecutive year, with a score of 557, performing particularly well in the account offerings and account information factors.. Mizuho Bank ranks second (545) and Resona Bank is third (543).

Self-Directed Bank Segment (Eight Banks Ranked)

SBI Sumishin Net Bank ranks highest in satisfaction for a third consecutive year with a score of 603. SBI Sumishin Net Bank performs particularly well in trading charges and fees. Sony Bank ranks second with a score of 580, followed by Shinsei Bank at 574.

Full-Service Regional Bank Segment (Thirty Banks Ranked)

Tokyo Star Bank ranks highest in the segment for a second consecutive year, with a score of 571, performing particularly well in account offerings. Suruga Bank ranks second (558) and Aomori Bank is third (555).

The 2014 Japan Investor Satisfaction Study is based on responses from 18,448 individual investors in Japan who are at least 18 years old and who have used investment services—such as investment trusts, stocks, foreign currency deposits and foreign exchange—at private banks and securities companies in the past year. The study was fielded in May 2014.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at japan.jdpower.com.

About JD Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info

About McGraw Hill Financial www.mhfi.com 

 

High Investor Satisfaction Leads to Increase in Amount of Investments

1970-01-01

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TOKYO: 3 August 2012 — Although overall customer satisfaction with the investment services of banks and securities companies is low, financial institutions have the opportunity to increase investments of individual investors by focusing on satisfaction improvements, according to the JD Power Asia Pacific 2012 Japan Investor Satisfaction Study^SM released today.

The study measures investor satisfaction with investment firms in six factors: account offerings; account information; trading charges and fees; facilities; problem resolution; and interaction (includes three sub-factors: advisor, website and call center).

Overall customer satisfaction with the investment services of banks and securities companies is low. In particular, the industry average scores for the full-service bank and full-service securities segments–518 index points each on a 1,000-point scale–are the lowest among all industries in which JD Power Asia Pacific has conducted research in the past year. For example, the overall satisfaction scores of nearly 30 percent of the full-service bank and full-service securities segments are about half the scores of approximately 60 percent in the life insurance industry. In addition, satisfaction levels are extremely low in comparison with the JD Power and Associates 2012 U.S. Full Service Investor Satisfaction Study^SM, in which the industry average score is 775.

However, the Japan Investor Satisfaction Study finds that improvement in satisfaction with investment services contributes to increasing investments from individual investors, resulting in additional income for financial institutions. For instance, while 16 percent of investors overall indicate a desire to increase the amount of their investments, the percentage increases to 32% among investors who answered the satisfaction above “Average” ” with their financial institution.

“Furthermore, approximately 40 percent of highly satisfied investors actually recommend their financial institution to others, and improving satisfaction is an effective means of gaining investors,” said Ryutaro Nakao, manager at JD Power Asia Pacific, Tokyo.

Although sales of investment products are subject to various laws and regulations, there is substantial room for increasing satisfaction by making improvements in services offered to investors. For instance, at full-service securities companies and full-service banks, satisfaction increases notably when specialist advisors understand investors’ interests and concerns. However, fewer than 10 percent of investors overall have received such services. Similarly, at self-directed securities companies and self-directed banks, even though the availability of trading tools, investment simulators and other investment support tools provided by financial institutions significantly affects satisfaction, fewer than 40 percent of investors have used such tools.
“For the past 10 years, growth has been slow even among banks that have focused on increasing sales of investment trusts and by self-directed securities companies and banks that have expanded their investor bases by offering low prices and convenience,” said Nakao. “Service improvement from the investor’s perspective is the key to winning customer trust and achieving further growth.”

Findings Highlights by Segment

The study divides financial institutions into four segments based on their sales systems: full-service bank; full-service securities; self-directed bank; and self-directed securities.

Full-Service Bank Segment (19 Banks Ranked)

Sumitomo Mitsui Banking Corporation ranks highest in customer satisfaction with an index score of 542, achieving high scores in the account offerings and account information factors and the website sub-factor. Saitama Resona Bank (532) follows in the rankings, performing well in the facilities factor.

Full-Service Securities Segment (Five Companies Ranked)

Nomura Securities ranks highest in investor satisfaction with an index score of 532, performing particularly well in the advisor sub-factor(advisor). Following Nomura Securities in the rankings is Daiwa Securities (527), with high scores for call center and trading charges and fees.

Self-Directed Bank Segment (Seven Banks Ranked)

SBI Sumishin Net Bank ranks highest in satisfaction with an index score of 611, achieving high scores for trading charges and fees, website and account information. Sony Bank (591) follows with strong scores across all factors.

Self-Directed Securities Segment (Five Companies Ranked)

SBI SECURITIES ranks highest in customer satisfaction with an index score of 584, achieving high scores in the trading charges and fees and problem resolution factors. Monex (580) follows in the rankings with high scores for account offerings, account information and website.

“Interestingly, the strengths and weaknesses of the institutions in the self-directed securities segment differ markedly for each factor, and it appears that they are attempting to differentiate themselves from competitors as much as possible in a fierce competitive environment,” said Nakao.

The 2012 Japan Investor Satisfaction Study is based on responses from more than 16,200 investors in Japan who have used investment services, such as investment trusts, stocks, foreign currency deposits, and foreign exchange, at private banks and securities companies in the past year. The study was fielded in May 2012.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected]

About JD Power and Associates

Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually.  For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

McGraw-Hill announced on September 12, 2011, its intention to separate into two companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial’s leading brands include Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts energy information services and JD Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

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No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. www.jdpower.com/corporate

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Satisfaction with Investment Services of Banks and Securities Companies in Japan Shows Notable Improvements

2013-07-20

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TOKYO: 23 July 2013 — Overall investor satisfaction with the investment services of banks and securities companies has notably improved from 2012, according to the JD Power Asia Pacific 2013 Japan Investor Satisfaction Study^SM released today.

The study, now in its second year, measures investor satisfaction with investment firms in six factors: account offerings; account information; trading charges and fees; facilities; problem resolution; and interaction, which includes three sub-factors—advisor, online services and call center. Overall satisfaction scores are calculated on a 1,000-point scale. The study categorizes financial institutions into five segments based on their sales systems: full-service securities; self-directed securities; full-service national banks; self-directed banks; and full-service regional banks. 

In 2013, 32 percent of individual investors indicate that they increased the amount of their investments in stocks, investment trusts and other instruments during the past year, a substantial increase of 14 percentage points from 2012. Investor assessment of the investment environment has also improved markedly as a result of the weakening yen and an uptick in stock prices since the end of 2012, with 29 percent of investors saying the current investment situation is “good” (15 percentage points higher than in 2012) and 45 percent saying the economic outlook for Japan is “good” (36 percentage points higher). Furthermore, overall satisfaction with banks and securities companies has improved considerably in all segments, increasing by between 9 and 22 points from in 2012. 

“Although the upturn in market conditions is a major contributor to the improvement in satisfaction, there are also other contributing factors involved. For example, in the full-service securities segment, which shows the greatest improvement in overall satisfaction, securities company advisors are stepping up their sales approach and investment proposal activities, and are offering more proactive communication with customers,” said Ryutaro Nakao, manager at JD Power Asia Pacific, Tokyo. “At the same time, the gap in overall satisfaction scores has widened somewhat, especially among securities companies. Since overall satisfaction greatly influences the amount customers invest, their intention to continue using services and their intentions to recommend, the continuous bolstering of customer services is likely to be increasingly important for stable business expansion.”

The study finds that the Nippon Individual Savings Account, or NISA (a small investment tax exemption system to be inaugurated in 2014), has already attracted the interest of individual investors. As of May 2013, when this study was fielded, 63 percent of investors indicate awareness of NISA and 50 percent indicate an intention to open NISA accounts. Both the awareness and intention to open an account are particularly high among investors who are 60 years and older. Although the rate of intention to open an account is high among men who are 30 years and younger and women 20 years and younger, awareness hasn’t yet reached comparable levels among these younger investors. Amid high expectations that NISA will increase the number of beginning investors, further marketing activities targeting younger investors is a key task for the industry.  

“Because our research finds that the intention rates for opening accounts tend to be higher for bank and securities companies that achieve high satisfaction ratings from individual investors, the steady pursuit of investor satisfaction can have an important impact on the success or failure in the impending full-scale competition to secure NISA customers,” said Nakao.

Overall Satisfaction Rankings by Segment

Full-Service Securities Segment (five companies ranked)

Nomura Securities ranks highest in investor satisfaction for a second consecutive year, performing particularly well in the advisor sub-factor. Following Nomura Securities in the rankings are Daiwa Securities and SMBC Nikko Securities, respectively, both with high scores in the online services sub-factor.

Self-Directed Securities Segment (six companies ranked)

SBI SECURITIES ranks highest in investor satisfaction for a second consecutive year, achieving the highest scores in account information and call center. Matsui Securities ranks second, moving up one position and achieving the largest year-over-year improvement in overall satisfaction in the segment. Matsui Securities performs particularly well in trading charges and fees. Monex ranks third, with high scores in account offerings and online services.

Full-Service National Bank Segment (five banks ranked)

Sumitomo Mitsui Banking Corporation ranks highest in investor satisfaction for a second consecutive year, achieving the highest scores in account offerings and account information. Mizuho Bank and Resona Bank rank second in a tie. Mizuho Bank posts a high score in account offerings, and Resona Bank earns high scores in facilities and trading charges and fees. 

Self-Directed Bank Segment (seven banks ranked)

SBI Sumishin Net Bank ranks highest in satisfaction for a second consecutive year, achieving a notably high score in trading charges and fees and also performing well in online services and account information. Sony Bank ranks second with strong scores across all factors, particularly in the call center sub-factor, followed by Jibun Bank, with a high score in online services. 

Full-Service Regional Bank Segment (30 banks ranked)

Tokyo Star Bank ranks highest in this segment and achieves the highest scores in account offerings and trading charges and fees. Suruga Bank follows in the ranking, performing well in account information and online services. Minato Bank ranks third, with a high score in account offerings. 

The 2013 Japan Investor Satisfaction Study is based on responses from 17,941 individual investors in Japan 18 years and older who have used investment services—such as investment trusts, stocks, foreign currency deposits and foreign exchange—at private banks and securities companies during the past 12 months. The study was fielded in May 2013.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected]

About JD Power

JD Power is a global marketing information services company providing performance improvement, social media and customer satisfaction insights and solutions. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. Headquartered in Westlake Village, Calif., JD Power has offices in North America, Europe and Asia Pacific. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power is a business unit of McGraw-Hill Financial.

About McGraw Hill Financial

McGraw Hill Financial (NYSE: MHFI), a financial intelligence company, is a leader in credit ratings, benchmarks and analytics for the global capital and commodity markets. Iconic brands include: Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, JD Power, McGraw Hill Construction and Aviation Week. The Company has approximately 17,000 employees in 27 countries. Additional information is available at www.mhfi.com. 

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No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power. www.jdpower.com/corporate

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