Novia Global and what it means to the business – Bill Vasilief, CEO Novia
ABR editor Rob Kingsbury talked to Novia Financial CEO Bill Vasilief about the launch of Novia Global, the offshore version of the Novia platform and what this means for the company
As concerns have been raised once again over the sustainability and longevity of brands in the UK platform market, the launch of Novia Global is confirmation that Novia Financial is both an innovative company and here to stay, according to CEO Bill Vasilief.
Vasilief says that Novia Global started as a concept over three years ago anticipating the move by offshore advice markets towards an RDR-like regime. “That has now come to pass. Most offshore regulatory regimes have followed RDR and MiFID II is going to be the next nail in the coffin for high commissions and hidden charges,” Vasilief says.
“We’ve had lots of feedback from the market saying that advisers are wanting to change to a clean, transparent and flexible model and wanting the technology to make that easy for them.
“We’re not going to see everyone coming on board straight away but the market will grow exponentially as more and more offshore regulatory regimes adopt cleaner and more transparent business practices.”
What Novia Global primarily brings to the market, Vasilief says, is the ability for advisers to carry out straight-through electronic transactions. “Our platform is a modern RDR-compliant offering, with access to a very wide range of assets. It’s press of a button technology. As soon as a transaction is put on the system and the adviser presses the submit button it goes live with the client record set up and we wait for the money to arrive to complete the transaction. There is no paper involved, it’s completely straight through and transforms the way advisers do business. In comparison, technology currently being used offshore is in the dark ages,” he says.
The platform is targeting international advisers and UK advisers with offshore clients, alongside private banks and trust companies.
It currently offers circa 600 funds from 23 fund managers, “with new funds being added to the platform on a daily basis as we seek to offer easy access to a very broad range of investments,” Vasilief says. Alternative investments such as ETFs and structured products will be available from Q1 2016 and the platform is currently in discussion with number of providers to add offshore bonds as well.
Clean share classes
While the offshore market currently hosts mainly pre-RDR-style funds and products, product providers with which the platform is talking “are seeing the writing on the wall” in respect of clean share classes, Vasilief says. “We expect to see the range of clean share classes expand considerably.”
Currently, to cater for the evolving nature of the offshore market, Novia Global supports all share class offerings, bundled and unbundled packages. “We have bundled pricing, where we pay commission to the adviser and that has access to a very wide range of assets. Then we have unbundled, which provides for adviser charging and which has less available assets at present but, as mentioned, this is growing all the time,” Vasilief says.
Another important driver for change, Vasilief says, is that clients are demanding products that have the equivalent of FCA regulated protection. “They can see its being implemented onshore and they can see the benefits and they want that security. It’s a demand we are hearing all the time,” he adds.
As well as straight through transactions, Vasilief says Novia Global offers all the portfolio modeling and performance analytics tools that the UK focused Novia platform offers but with the major difference that it is multi-currency. The main currencies on the platform are sterling, US dollars, HK dollars and the euro.
“We can add currencies very quickly. When building the platform we didn’t want to be hampered in what we wanted to do by the third-party technology provider, having to wait around for a time slot to be found to upgrade the system. We wanted to be able to change things right away. So we built the front-end foreign exchange capability ourselves, which means we can add currencies quickly, as and when we need them.
“So if a client buys in with one currency and wants to purchase a fund with share classes in another currency, we can do a quick and low cost FX transaction to allow the client to buy whatever share class they want.”
The platform is now accessible across Europe, as well as in the Cayman Islands, Israel and Hong Kong, with others in the pipeline, Vasilief says.
One of the key considerations when setting up an offshore platform dealing with a range of different jurisdictions, Vasilief says, is that the jurisdictions all have different regulatory regimes and different ways of doing things. “We’ve been working with each local regulator to ensure the platform conforms with that regime. We’re not about to upset local regulators. This is a long-term play and commitment, not a way of making a fast buck,” he stresses.
Vasilief believes the potential in the offshore market for a truly full-service platform is huge. “There is a massive sea-change in sentiment coming through the offshore market, which over the next few years is going to see more and more regulators and clients start demanding transparency, because transparency is core to treating customers fairly. We are ideally placed to help adviser firms make the progression to the kind of adviser charging structure regulators are going to want to see because there is no-one in the market with a platform like us.”
In the launch of Novia Global, Novia has stolen a march over other platforms, which Vasilief says, reflects the company’s innovative mindset and its commitment to the adviser market. “Currently, we’ve over £4bn on the Novia Financial platform, which is business put on there by advisers, who are our market. In fact we’re one of the few platforms in the market that really caters in our strategy and our thinking for the retail adviser market rather than chasing down institutional business.”
Certainly, its first mover presence in the offshore space, is one Vasilief is keen to take advantage of to build greater assets and profitability into the company. Novia Financial has a 23% stake in the new platform.
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