IN THIS ISSUE

Dear stakeholder

In recognising the critical role of key Government institutions in facilitating economic growth and job creation through prudent fiscal and monetary policy as well as setting the framework for private sector participation, ASISA hosted a media roundtable in Johannesburg in July. The roundtable explored why undermining key institutions could result in a credit ratings downgrade for South Africa and why this would have a profoundly negative effect on all South Africans.

In addition, we exposed journalists to the growing partnership between Government and the private sector aimed at supporting institutions that are key to education, infrastructure provision and small businesses.

We would like to thank the following member representatives for their participation in this information-sharing event:

• Derrick Msibi: MD at Investment Solutions
• Nazmeera Moola: Member of ASISA’s Funding Growth Standing Committee and Co-Head of SA and Africa Fixed Income at Investec Asset Management
• Mamokete Lijane: Member of ASISA’s Funding Growth Standing Committee and Head of Macro Strategy at Aluwani Capital

National Treasury published a revised draft of the Financial Sector Regulation (FSR) Bill together with a comments matrix that responds to submissions made by various parties.

The revised draft is a proposal to the Parliamentary Standing Committee on Finance (SCoF), which will make the final decision on any changes before the Bill is submitted to the National Assembly.

The ASISA FSR Bill Working Group representatives were asked to submit comments to ASISA by 2 August 2016. ASISA's attorneys briefed Counsel to check whether the revised draft adequately addresses ASISA members' concerns about the constitutionality of certain aspects of the current Bill. Counsel has confirmed that the revised Bill complies with the Constitution. SCoF meetings to deliberate the Bill are scheduled for the third week of August.

ASISA and the FIC met in July with the aim of establishing a sound footing for future engagements. The topics discussed included:

• Update and next steps on the FIC Amendment Bill
• Registration and reporting by ASISA members
• PCC 31
• Interaction with FATF
• BankservAfrica FICA Solution
• Future co-operation and engagement

It was agreed to hold these meetings twice a year.  Operational meetings will also be scheduled when necessary.

National Treasury released the draft 2016 Taxation Laws Amendment Bill giving effect mainly to what was announced in the National Budget in February.

The following is likely to be of interest to members:

• What constitutes “taxable income” for the purposes of the new retirement fund contribution deduction?
• Treatment of rollover of excess retirement fund contributions before 1 March 2016.
• Changes to source rules and taxation of lumps sums in regard to the foreign service exemption.
• The taxation of trusts in regard to interest free loans.
• Life office tax changes as a result of the implementation of SAM.
• Exemption of CIS in securities from controlled foreign companies rules.
• Changes to employee based share incentive schemes.
• Refining outright transfers and collateral provisions.
• Retirement annuity withdrawals on emigration.

On 20 July 2016 National Treasury also released for comment a revised special Voluntary Disclosure Programme (VDP) in respect of offshore assets and income.

The 2015 Living Annuities Survey was released in July. The results show that at the end of 2015, South Africans had R331.6 billion (R278.9 billion in 2014) of their retirement savings invested in 410 898 living annuities (360 894 in 2014). In 2015 living annuities attracted new inflows of R58 billion compared to R46.5 billion in 2014.

According to the survey, living annuity policyholders withdrew on average 6.44% of their capital as income in 2015.

National Treasury has published for a third round of consultation the Financial Markets Act Ministerial Regulations covering over-the-counter (OTC) derivative markets, CSD-CSD link arrangements as well as assets and resource requirements for market infrastructures. ASISA’s OTC working group will submit comments.

EntASISA has been in informal discussions with National Treasury and the Financial Services Board (FSB) around CIS portfolios investing in infrastructure development.  A working group has now been formed to provide more structure to this initiative.

The JSE has made a successful conversion from a T+5 to a T+3 settlement cycle for listed equities during July, bringing the local equity market in line with international settlement standards. It is expected that this alignment with global standards will increase the interest from foreign investors in our market. It also reduces the potential settlement risks and enhances investor protection.
 
Although this change has had a major impact on the post trade processes of asset managers, our members’ commitment to the new processes is evident from the following statistics:

• On average 55% of settlements are committed on Trade date
• On average 99% of settlements are committed on Trade date+1

The Fund concluded the final selection phase for the much-anticipated launch of the Stockbroker Development Programme.

Sponsored by Coronation, Investec, Old Mutual, Prudential, Stanlib and Sanlam Investments, the initiative is custom designed to provide specialist growth support to locally built, black-owned stockbroking businesses.

Each business will receive specialist business acceleration, compliance and monitoring support over three years. In addition, stockbroking coaches will be allocated to each participating business.

The Fund will further provide a potential source of growth funding for the businesses should it be required for capital adequacy or other reasons.

The Foundation’s roll out of the Saver Waya-Waya programme for TVET (Technical Vocational Education and Training) College students was completed in June. The programme reached more than 1 200 young adults across four campuses in Hammanskraal, Brits, Mankwe and Rustenberg. The programme was designed to empower and help students make the right financial choices when they enter the world of work.

Multiple modes of communication were used to entrench key messages that focused on themes such as planning and budgeting, needs versus wants, savings and earning interest, credit and paying interest, money and the world of work, as well as softer skills such as preparing a CV and preparing for a job interview.

The programme was well received by the leadership of the TVET Colleges and level of participation and creativity was hugely encouraging.

The Academy is excited to report that it is once again running the UCT Life Insurance Claims Assessors’ Short Course in Johannesburg. The course, now in its fourth year, commenced in July with 14 candidates.

The Retirement Fund Trustee Education programme continues to deliver engaging workshops for trustees in Cape Town, Johannesburg and Bloemfontein.  Furthermore, the Academy welcomed its sixth cohort of IMACS@TSiBA candidates. These 13 TSiBA students will be completing their elective in Investment Administration and Client Servicing with the Academy between July 2016 and June 2017, after which they will enter the workplace for the first time as interns with ASISA members. 

Through its Independent Financial Advisor (IFA) Internship programme, the Academy is also mentoring 21 IFA interns who have been placed at 13 IFA practices in Johannesburg and Cape Town.

We would like to officially welcome on board Rodger Walters, a CA (SA) and Chartered Financial Analyst, who joined us from Momentum Asset Management in July. Rodger is a consulting senior policy adviser responsible for ASISA’s Africa Initiative. 

Congratulations go to Brad Frank, who has been promoted to Senior Policy Adviser with effect from 1 July 2016. In addition to his existing responsibilities, Brad is now also the point person for the Transformation, Skills Development & Education Board Committee.

Kind regards