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16 March 2016
His mandate was clear – grow the Sanlam brand in the region, and create a unified, integrated financial service business recognised for the quality of its advice, asset and discretionary fund management services. After only three months in the hot-seat, we caught up with Jonathan during a recent visit to South Africa.
I am passionate about the wealth management business in general, and I believe there is a huge need in most countries for better client advice, especially as states do less and less in terms of retirement provision for citizens. I really like what Sanlam has done in the UK over the past 15 years, and can resonate with the ethos of brand – its focus on strong, embedded values and its belief in client-centricity. I’m looking forward to leading the next stage of the Group’s development in the UK.
Sanlam has the advantage of not having any of the ‘baggage’ that many of the developed countries’ financial services institutions have. During the credit crisis, many investors in the US, the UK and the rest of Europe fell out of love with some of the big institutions, but Sanlam wasn’t really affected. We have a tremendous opportunity here to develop and expand what is still a ‘clean’ brand in the UK.
In general, investors have responded well to the current volatility in the markets, especially those who came through the 2008 global recession. It seems that people now have an understanding that it is better to remain invested in such times than to take money out of the market. A global trend we have noticed, however, is a growing appetite for offshore investments – not only traditional equity and bond investments, but also property. London specifically has been a net beneficiary of both of traditional and property investments.
We have experienced markedly increased flows from South Africa, but also from Australia as well as other African countries. A big driver is negative sentiment resulting from political uncertainty and currency depreciation, and of course, for South Africans, the lifting of exchange controls.
It is therefore very important for the Sanlam Group to have a well-established London hub for offshore investors. To meet client expectations, Sanlam Private Wealth has spent much time and effort in developing competent offshore offerings. We’ve offered specialist products and services for offshore investors for several years now, and in a global context we remain small enough to offer a bespoke service. There is also the reassurance of being part of the Sanlam Group – a well-respected and recognised brand among South Africans and other parts of Africa.
Across the other businesses of Sanlam UK – our asset management, life and pensions, and holistic financial planning businesses – there are also products and services which can augment the services that we offer our offshore clients. Our aim is to deliver to our offshore clients one overall Sanlam integrated offering.
There are currently around 513 000 high net worth individuals in the UK (with more than £1 million to invest) and 1 000 ultra high net worth individuals (more than £25 million in investable income). Although the UK is a highly competitive market, I believe the Sanlam brand will resonate with investors in the UK. High net worth individuals tend to understand the market very well and are generally more open to opportunities to move between wealth managers than other investors. So if you can demonstrate excellent performance and client solutions, and have a solid and highly reputable parent company, then you will be on an equal footing with the best.
Attracting and retaining the younger, emerging rich set is crucial for all wealth managers – not only those with generational wealth but also young professionals and entrepreneurs. The important thing is to establish meaningful relationships early on, to ensure these clients continue to gravitate back to your organisation in the years to come. One way of attracting them is by building relationships with external organisations such as prominent legal and accountancy firms who can refer potential clients.
Whereas the relationships between wealth managers and individual clients remain paramount, reaching out to younger clients will also require a competent digital offering, so this will remain an important focus for us going forward.
Yes, absolutely. The emerging markets have been hit for geo-political reasons and exchange rate issues, but there are companies in these countries that are currently hugely undervalued and have great fundamentals, especially in the Asia-Pacific region. Long-term investors should not write off emerging markets despite negative sentiment.
Our aim is to develop a one-stop-shop for our client base going forward, with our financial planning operation at the front end, backed by our various business units – investment, asset management and life assurance – which are the manufacturers of the solutions that our clients require.
In terms of business growth, I believe this needs to happen through a healthy mix of organic growth as well as further acquisitions – the most important of which is a continually strong organic growth profile. Acquisitions are by their very nature opportunistic, and the price of financial assets is very high in the UK. And Sanlam is known for not ‘betting the farm’ and committing too much capital. So we will follow the route of smaller transactions, at the right price and with the right cultural fit.