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Asset Management Industry in South Africa 2024

Stephen Timm | South Africa | 20 August 2024

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Report coverage

This report on the asset management industry in South Africa includes comprehensive information on the size of the industry, retirement fund assets under management, and issues such as outflows, reduced liquidity, returns, the country’s low savings rate and regulation, including the introduction of the two-pot retirement system. There is information on notable players, their performance, developments and corporate actions, and profiles of 34 companies including the Public Investment Corporation and the Government Employees Pension Fund, large private asset managers such as Ninety One, Allan Gray, Old Mutual Investment Group and Sanlam Investment Managers, and smaller fund managers such as Abax and Benguela Global Fund Managers.

Report coverage

This report on the asset management industry in South Africa includes comprehensive information on the size of the industry, retirement fund assets under management, and issues such as outflows, reduced liquidity, returns, the country’s low savings rate and regulation, including the introduction of the two-pot retirement system. There is information on notable players, their performance, developments and corporate actions, and profiles of 34 companies including the Public Investment Corporation and the Government Employees Pension Fund, large private asset managers such as Ninety One, Allan Gray, Old Mutual Investment Group and Sanlam Investment Managers, and smaller fund managers such as Abax and Benguela Global Fund Managers.

Introduction

• Asset managers play an important role in growing and retaining investments on behalf of retail and institutional clients.\r\n
• Total assets under management of South African retirement funds grew in 2023.\r\n
• Several challenges threaten the country’s savings pool, including the poor economy, reduced liquidity, political uncertainty, growing regulations and input costs, and increased emigration.\r\n
• Trends shaping the industry include the use of artificial intelligence, the growing importance of environmental, sustainability and governance and responsible investing and the increased role of alternative assets.

Trends

• AI is being used to streamline operations, automate routine tasks and enhance compliance and client reporting.
• Asset managers are increasingly allocating more to alternative assets including private debt, hedge funds and private equity.
• Climate change has become a growing long-term risk.
• ESG is becoming a bigger consideration.
• Establishment by large asset managers of boutique asset managers.
• High interest rates and geopolitical uncertainty have fuelled an outflow of assets, while struggling consumers are reluctant to invest in a volatile market.
• Increased allocation to passive and rules-based strategies.
• Local crypto companies are looking to offer crypto asset investment products.
• Multi-managers are increasingly growing their share of AUM.
• Tokenisation is being considered by some asset managers.

Opportunities

• Assisting black asset managers.
• Cryptocurrency ETFs.
• ESG and sustainability-linked investment products.
• Hiring more women.
• Offshore investment products.
• The use of AI to streamline portfolio management.
• Tokenisation.

Challenges

• Emigration of wealthy South Africans.
• High interest rates and geopolitical uncertainty continue to dampen investor risk appetite.
• Operating costs are outstripping inflation.
• Political risk increased ahead of the elections and after the ANC failed to get a 50% majority.
• South Africa’s low savings rate.
• The industry is still male-dominated.
• The net outflow of assets and the delisting trend on the JSE are growing concerns.
• The two-pot retirement system could lead to a significant outflow of funds.
• Transformation and BEE.

Outlook

• While asset management has been affected by slowing economic growth, negative investment sentiment and political uncertainty, market conditions have been gradually improving.\r\n
• The domestic savings industry is expected to continue to contract due to the poor economy, stagnant formal employment and households under pressure, exacerbated by the outflow of retirement and discretionary savings offshore.\r\n
• The industry may experience net outflows of 1% of assets under management following implementation of the two-pot retirement system.\r\n
• Asset managers are likely to continue investing in technology to mitigate the increase in input costs and increase their focus on responsible investing.

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Asset Management Industry in South Africa
Asset Management Industry in South Africa 2024

Full Report

R 20 000.00(ZAR) estimated $1143.44 (USD)*

Industry Landscape

R 14 000.00(ZAR) estimated $ 800.41 (USD)*

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1 Industry Value Chain 3
2.2 Geographic Position 4
2.3 Size of the Industry 4
3. LOCAL 7
3.1 State of the Industry 7
3.2 Key Trends 19
3.3 Key Issues 19
3.4 Notable Players 20
3.5 Corporate Actions 21
3.6 Regulations 23
3.7 Enterprise Development and Social Development 24
4. AFRICA 27
5. INTERNATIONAL 28
6. INFLUENCING FACTORS 31
6.1 Economic Environment 31
6.2 Labour 32
6.3 Environmental Issues 34
6.4 Technology, R&D, Innovation 35
6.5 Government Support 37
6.6 Input Costs 38
6.7 Crime 39
7. COMPETITIVE ENVIRONMENT 41
7.1 Competition 41
7.2 Ownership Structure of the Industry 41
7.3 Barriers to Entry 42
8. INDUSTRY SUMMARY 42
9. OUTLOOK 43
10. INDUSTRY ASSOCIATIONS 44
11. REFERENCES 44
11.2 Publications 44
11.3 Websites 45
ANNEXURE 1 47
Relevant Legislation 47
APPENDIX 1 54
Summary of Notable Players 54
COMPANY PROFILES 57
36ONE ASSET MANAGEMENT (PTY) LTD 57
ABAX INVESTMENTS (PTY) LTD 59
AEON INVESTMENT MANAGEMENT (PTY) LTD 61
ALEXANDER FORBES INVESTMENTS LTD 63
ALL WEATHER CAPITAL (PTY) LTD 65
ALLAN GRAY (PTY) LTD 67
ALUWANI CAPITAL PARTNERS (PTY) LTD 70
ASHBURTON FUND MANAGERS (PTY) LTD 72
BENGUELA GLOBAL FUND MANAGERS (PTY) LTD 74
CADIZ ASSET MANAGEMENT (PTY) LTD 75
CATALYST FUND MANAGERS (PTY) LTD 76
CORONATION ASSET MANAGEMENT (PTY) LTD 77
FAIRTREE ASSET MANAGEMENT (PTY) LTD 80
FOORD ASSET MANAGEMENT (PTY) LTD 82
FUTUREGROWTH ASSET MANAGEMENT (PTY) LTD 84
GOVERNMENT EMPLOYEES PENSION FUND 87
LAURIUM CAPITAL (PTY) LTD 95
LEGACY AFRICA FUND MANAGERS (PTY) LTD 97
MANDG INVESTMENTS SOUTHERN AFRICA (PTY) LTD 98
MATRIX FUND MANAGERS (PTY) LTD 101
MOMENTUM ASSET MANAGEMENT (PTY) LTD 103
NEDGROUP INVESTMENTS (PTY) LTD 105
NINETY ONE SA (PTY) LTD 107
OLD MUTUAL INVESTMENT GROUP (PTY) LTD 109
OLD MUTUAL MULTI-MANAGERS (DIV OF OLD MUTUAL LIFE ASSURANCE COMPANY (SOUTH AFRICA) LTD) 112
PSG ASSET MANAGEMENT (PTY) LTD 113
PUBLIC INVESTMENT CORPORATION SOC LTD 115
SANLAM INVESTMENT MANAGEMENT (PTY) LTD 122
SASFIN ASSET MANAGERS (PTY) LTD 125
STANLIB ASSET MANAGEMENT (PTY) LTD 127
TAQUANTA ASSET MANAGERS (PTY) LTD 130
TRUFFLE ASSET MANAGEMENT (PTY) LTD 132
VISIO FUND MANAGEMENT (PTY) LTD 134
VUNANI FUND MANAGERS (PTY) LTD 136