IN THIS ISSUE

Dear stakeholder

The month of August ended with Futuregrowth Asset Management publicly announcing its decision to suspend loans to six  State Owned Enterprises (SEOs) due to growing concerns about governance and decision-making structures of these entities.

In the days following this announcement, ASISA was inundated by the media and other stakeholders to comment on the position taken by Futuregrowth.

In response we pointed out that ASISA cannot express a view on Futuregrowth’s announcement. ASISA is an industry body mandated by its members to deal with industry issues, which include policy, regulatory and legislative matters. The Association can never influence where members invest since this could be considered collusive behaviour, which is illegal.

We also stated that it is the fiduciary duty of each individual investment manager to invest client money where, based on their perception and research, the expected returns come at an acceptable level of risk. Futuregrowth exercised this fiduciary duty. However, we cautioned Futuregrowth against drawing ASISA and other investment managers into their decision making process on the SOE funding debate.

We have taken note of Futuregrowth’s subsequent apology for not having followed a fairer and more measured approach of direct consultation with each SOE before contemplating public comment.

The full ASISA statement can be read here.

Members of the ASISA Executive Committee and the Financial Services Board (FSB) Executive Committee attended the second feedback meeting for 2016. These valuable biannual information-sharing sessions focus on high-level industry developments and challenges of mutual concern.

The Parliamentary Standing Committee on Finance (SCoF) commenced deliberations on the FSR Bill on 17 August 2016, which will continue until this Parliamentary session ends in September. ASISA attends each meeting and reports back to the ASISA FSR Bill Working Group.

The Financial Intelligence Centre released an Issue Paper to elicit comments on aspects where accountable institutions will require guidance when the amendments to FICA take effect. The Issue Paper has been referred to ASISA’s FICA committee for comment by the deadline of 19 September 2016.

ASISA released the Collective Investment Schemes (CIS) industry statistics for the quarter and year ending June 2016, which show that the industry holds assets under management just shy of the R2 trillion mark.

At the end of the second quarter this year, the local CIS industry managed assets of R1.96 trillion, compared to R1.92 trillion at the end of the first quarter this year and R1.89 trillion at the end of December 2015.

At the end of June 2016, South African investors had a choice of 1 403 portfolios – an increase of 43 from the end of March 2016.

SA Multi Asset portfolios held 51% of assets, Interest Bearing portfolios 24%, Equity portfolios 21%, and Real Estate 4%.

The Academy concluded a highly productive month, with more than 100 people having attended a variety of learning programmes.

In Cape Town the Academy delivered the UCT Collective Investment Schemes Short Course (UCT CIS), the UCT Investment Management Administration and Client Servicing Short Course (UCT IMACS), the Equity Analysts’ Bootcamp and an in-house Investment Induction Blitzcamp for Sanlam Investment Management.

In Johannesburg the UCT Life Insurance Claims Assessors’ Short Course gained momentum in its second month and a four-day Group Communications Bootcamp was delivered for MMI Holdings. Two separate Retirement Fund Trustee Education (RFTE) Workshops were also presented to pension fund trustees of Batseta members and the World Wildlife Fund (WWF).

The Academy was also privileged to see its 2014/2015 cohort of IMACS@TSiBA students graduate from the Tertiary School in Business Administration (TSiBA).

We share the excitement of the ASISA Enterprise And Supplier Development Fund, which received the first tranche of the US$1 million grant from the US Agency for International Development (USAID). The Fund is one of only eight applicants worldwide selected for this grant, which was awarded in March this year.

The total grant is payable over three years as part of the USAID Partnering to Accelerate Entrepreneurship (PACE) initiative. PACE aims to catalyse private-sector investment into early-stage enterprises and identify innovative models or approaches that help entrepreneurs bridge the pioneer gap thereby unlocking the potential of thousands of promising enterprises around the world.

The partnership with USAID will boost the Fund’s support for the growth and development of SMEs in the supply chain of ASISA’s members, with a further twelve tranches planned against milestones.

Kind regards