Transcript Document

Financial Planning in Hungary
I. FINANCIAL INTERMEDIARIES IN HUNGARY
dr. József Banyár,
Counsel and supervisory commissionar of
HFSA Hungarian Financial Supervisory Authority
II. LICENSING, TRAINING AND MARKET EXPERIENCES IN
HUNGARY
dr. Daisy Huczka,
SB Chairwoman of HAQFP Hungarian Association of Qualified
Financial Planners, Counsel of Ministry of Finance
III. THE HUNGARIAN CFPTM PROGRAM
Zoltan Luttenberger PhD,
General Manager of HAQFP
FINANCIAL
INTERMEDIARIES IN
HUNGARY
dr. József Banyár,
HFSA Hungarian Financial Supervisory Authority
Major financial indicators of
Hungary (end of 2007)
Population
Million
GDP
Billion €
GDP/capita
€
CPI
Unemployment
Net financial assets of households Billion €
International reserves
Billion €
Currency ratio
€
10,143
100,15
9.959
7,4 %
7,7 %
62,2
16
253,35
Hungarian banking sector – Profit after tax (billion €)
2001.
0,45
2002.
0,51
2003.
0,67
2004.
1,07
2005.
1,29
2006.
1,41
2007.
1,26
Comparison of reserves
Annual insurance premium (billion €) and its distribution between life
and non-life
Changes of premium to the previous year (%)
Composition of intermediary market
Number of insurance intermediaries(2008.03.31.)
• 39.896 Insurance intermediary natural person. Out of this:
• dependent (agent): 19.889
• independent: 20.000
• advisor: 7
• 10.990 organization. Out of this
• 406 broker,
• 44 multiply agent
Agents of banks:
•(mainly institutions): 292
•(mainly natural persons): 22.320
Investment advisory firms: 27
Securities agents: 2375
Agents of financial undertakings (non banks and consumer credit
organizations):
•351
•8356
Tendencies in insurance intermediaries:
• until 2007 constantly increased the number of intermediaries – now it is
stagnating
• gradually increases the share of independent intermediaries
Financial advisors versus insurance
intermediaries
The insurance intermediary market is:
• quite strong
• well regulated (compared to the other’s)
It is mainly the basis of the financial intermediaries on other fields:
•Credit (personal and mortgage)
•Pension (and health) funds
•Building societies
•...
In insurance two sub-markets are strong:
- Unit Linked (the share of this constantly increases in the life business)
- Third party motor liability
The lack of regulation allows agents to sell UL without investment advice
knowledge and license
Education and market experience
Educational requirements only for insurance intermediaries
→ transitional period
→ approaching to the end
→ insurerers lobbying
→ softening the requirements are in process
About 70% of the intermediaries does not have the required
exam
The independent intermediaries a bit more educated than the
dependents – some insurers are better, then the rest
The role of HFSA
So far we mainly concentrated to the supervision of insurance
institutions – thinking, that the intermediaries belong to these
It is less and less true with the increasing importance of
independent intermediaries
HFSA recommendations about transparency of commission
and cost of (savings type) life insurance contracts – plan to
regulate the level of commission indirectly
We would like to know the problems and risks on this field →
an ongoing HFSA research project on financial advisor industry;
LICENSING, TRAINING AND
MARKET EXPERIENCES
IN HUNGARY
dr. Daisy Huczka,
SB Chairwoman of HAQFP Hungarian Association of Qualified
Financial Planners,
Counsel of Ministry of Finance
LICENCE REQUIREMENTS' MODEL
FOR FINANCIAL INTERMEDIARIES
• State recognized upper degree ie. BA or MA
• Financial or insurance professional licence issued by the
Authority (HFSA register, exams by Ministry of Finance)
• The National List of Professions = the official list of the state
recognized professions in Hungary
LICENCE REQUIREMENTS FOR
FINANCIAL INTERMEDIARIES
• The content of the list: recently 800, now about 400
professions
• The requirements for getting licence to become skilled
professional for any profession are appeared in a ministerial
decree
• The modernization of the list: in 2007.
LICENCE REQUIREMENTS FOR THE
FINANCIAL PLANNER
• Difference between the old and new list: COMPETENCE
based structure
• In the banking sector: medium and upper degree
• In the insurance sector: medium and upper degree
(intermediatory and adviser)
LICENCE REQUIREMENTS FOR
FINANCIAL INTERMEDIARIES
• New official exam for the intermediatory register from 1st
July 2008
• Last but not least: the new training and exam for Registered
and Quailified Financier Planners
• The future: the state/official approval/recognization of the
CFP program
MARKET EXPERIENCE
• The future: Quality instead of volume
• The more sophisticated economy, the more need of
professionals
• The higher financial culture, the more need of
professional financial advises
The Hungarian CFPTM
program
How did we start up a new industry in Hungary?
Zoltan Luttenberger PhD,
General Manager of HAQFP
Step I: RESEARCH (2004-2005)
Certified Financial Planners®
o Regulation, history, organization and best practice
(www.cfp.net, www.fpanet.org, www.fpsb.org)
o Education: job profile, competencies, planning cases
Financial Planning in the EU
o IFA, private banking, Finanzplanung
o Consumer protection: MCR - Minimum Competency
Requirements, transparency rules, needs analysis
etc.
Step II: SETUP (2006-2008)
Start program, launch project company
Contract and co-operation with FPSB Financial Planning
Standards Board
Engage stakeholders
o National: leading IFA networks and FI, regulators
(HFSA, Ministry of Finance), Consumer protection,
education institutes
o International: professional and education organizations
o Secure resources: colleagues+competency+cash
Corporate and public PR campaigns
Register national trademarks Registered + Qualified
Financial Planner
Design FP training and exam system
Step III: establish the new standards
Train, examine and certify FP professionals:
o 2 national levels (RFPH - “lite”, QFPH - ISO 22222)
o Prepare for CFPTM certification
Write and approve
o Practice Standards
o Code of Ethics
o Others regarding "4E" and in line with int. standards
o Customer info kit and “demo” plan
Publish and deploy (execute)
o principles: volunteers, democratic, professional
o regulations
o in both HU and EN (www.mptsz.hu)
Why financial planning?
"Client first"
A lifelong trust based relationship
Professional community
Setting the benchmark
The public interest
Financial health
Good job
High quality clientele and
exceeding income
How to succeed?
Motivated professionals (FP, IFA)
o volunteers
o democratic
Professional management
o projects
o knowlegde
o PR and IT
Corporate stakeholders collaborating
o FI
o Regulators (financial and education)
o Professional educators
Join the international community
CEE opportunities
Share knowlegde
Build a regional network/team/organization of FP
professionals
Establish new national FP industries
Set the standard/benchmark
Strengthen (the economy of the) CEE region
Qestions and answers
Thank you for your attention!