Funds Congress Highlights

• Moderator: Sebastien Danloy, Chief Business Officer, Euroclear
• Daniel Rudd, CEO of HSBC Asset Management UK and Head of UK Wholesale
• Honor Solomon, CEO-EMEA, Alliance Bernstein
• Jason Windsor, Chief Executive, Aberdeen

The session brought together chief executives from HSBC Global Asset Management, AllianceBernstein, and Aberdeen Group to discuss strategic priorities including fee compression, consolidation, regulatory developments, product evolution, and technological transformation.

China’s economic indicators: Recent trade engagement with China revealed significant infrastructure transformation, including widespread electric vehicle adoption. However, concerning indicators persist, including weak consumer demand, low inflation, and falling prices, raising questions about what will trigger increased domestic demand.

Fee compression and client consolidation: Fee compression remains a major theme, spanning a spectrum from index funds at near-zero fees to high-revenue alternatives with liquidity and operational challenges. Client consolidation is accelerating, with managers now requiring approximately 300 million in assets under management for viable fund launches and clients limiting partnerships to around ten strategic managers.

UK retail investment reforms: Recent reforms including the Mansion House and Leeds reforms aim to address the UK’s significant savings gap of approximately 610 billion pounds in cash accounts, encouraging a shift from cash ISAs into stocks and shares ISAs. The targeted support initiative becomes
effective in April 2026, though the industry bears collective responsibility to ensure products remain suitable and understandable for retail investors.

ETF momentum: In 2025, 58 asset managers launched ETFs in Europe, with 576 new products introduced and assets growing 42 per cent year-on-year. The global ETF market stands at approximately 17 to 19 trillion in assets. European distribution structures remain not fully adapted to ETFs, which constrains growth relative to the United States.

Private markets expansion: Private alternatives offer diversification, yield, and long-term returns, with the Mansion House Accord committing 17 pension fund signatories to holding at least five per cent of portfolios in private alternatives. A clear trend towards evergreen fund structures is evident, with private credit currently representing only two per cent of the global market,indicating substantial growth potential.

Tokenisation awaits catalyst: Conceptual support exists for tokenisation, with technically successful pilots generating limited returns relative to investment. The fundamental challenge remains achieving simultaneous market adoption, as benefits require coordinated industry participation and the catalyst for this remains unclear.

AI adoption trajectories: Views diverged on AI maturity, with some firms characterising it as business-as-usual after a decade of utilisation, whilst others see enormous opportunities through large language models. Rather than replacing jobs, AI is expected to increase efficiency within existing roles, with substantial upskilling anticipated across organisations between now and 2030.

CEO priorities for 2026: Leadership priorities centre on culture and talent, winning hearts and minds around AI implementation, and externalising private markets capabilities to clients.