Reporter

Asset management faces a revolution

A recent report from KPMG claims the next 15 years could produce something of a revolution.

In the paper, titled “Investing in the Future”, KPMG describes how the world of investment management is likely to change by 2030.

The investment management industry is still in its infancy compared to other financial services sectors.

It has grown on the back of the baby boomers over the last 30 years. But healthy margins often breed complacency, and because of the growth story, there has generally been a lack of innovation.

The KPMG report highlights four megatrends that it believes will shape the sector over the next decade and a half – demographics, environment, technology and social values, and behaviour and ethics.

The younger client base wants immediate and personalised information and traditional models have become obsolete.

KPMG also believes that investors will “increasingly value outcomes and certainty over returns”. This could extend to retirement products offering more than just cash-based payouts.

“For most, retirement planning is about securing lifestyle expectations rather than simply cash accumulation,” the report states. “On that basis, options to secure holidays, cars and healthcare during retirement may be as attractive as putting aside cash.”

Technology has increased competition and investment managers will not only have to manage their products accordingly but how clients engage with them.

“Personalised information and education about the choices available will become as important – if not more so – than the underlying product,” the report argues.

Part of this will be the desire for investment managers to have a more direct relationship with their clients.

“We also believe that investment managers can play a much broader, deeper role in clients’ lives and the industry value chain,” KPMG states.

“However, it will require a very different business model; one which requires providers to be much more engaging and relevant to a broader range of customers. This will mean understanding clients far better than today and creating a new value proposition based around education, outcomes (not just returns), flexibility and personalised solutions.

“While relatively small in both number and scale at this stage, there are emerging models leveraging a combination of technology, data and social networks to bring fresh propositions to market which play to the evolving megatrends,” it says. “These could have the potential to cause waves in the industry.”

The biggest challenge is establishing a trusted brand, something that is critical in any financial services business. But while this is a short-term concern, it is also potentially a longer term opportunity.

Companies might look to form strategic partnerships with established providers. Already there are examples in China of social network brands linking up with asset managers to distribute their products.

“This potentially provides opportunities for non-traditional new entrants,” the report argues. “It may seem a little clichéd but could the likes of Amazon, Google and Apple be the next powerhouses in investment management? After all, they are the top three in the Fortune World’s Most Admired Companies list in 2014.”

These companies already have ubiquitous brands, business models designed around understanding personal needs, huge existing client bases, and the proven ability to use the data that they capture to deliver personalised services. This could be exactly what the industry needs.

US cuts aid to Uganda over anti-gay laws

Uganda’s shilling dropped to the lowest level in nine months after the US government said it was cutting aid to the East African nation.

The US cut aid over a February law that toughened punishment for homosexual acts.

The currency fell 0.8 percent to 2,610 per dollar by 1:37 p.m. in the capital, Kampala, the lowest since Aug. 26.

The shilling slumped 6.1 percent since President Yoweri Museveni signed the bill on Feb. 24.

The US is discontinuing or redirecting funds for programs in Uganda, where life sentences can be imposed for some homosexual acts, the National Security Council said last week.

Norway, Denmark and Sweden also redirected or withheld aid.

The shilling weakened “because of the negative sentiment after the US announced they are cutting off donor funding,” Joseph Mwanguo, head of treasury at NIC Bank Uganda Ltd. said by phone today. “There will definitely be reduced inflow of dollars.”

It will impact people that the US “purports to support and aims to protect,” the Ugandan government said in an e-mailed statement.

Source: Bloomberg

Prince William gets $11m heli for his birthday

Prince William received an $11-million helicopter from his grandmother, Queen Elizabeth, for his 32nd birthday today.

William, heir to the throne behind his father Prince Charles, received a 2008 Agusta A109S Grand helicopter from the British monarch. Local media identified the helicopter model.

The new helicopter will help William and his wife, Kate, the Duke and Duchess of Cambridge, zip between home and official engagements, and be used to ferry other members of the Royal Family around, the Daily Mirror reports.

It says the helicopter costs will be covered by the sovereign grant, which is a sum of money the government gives to the Royal Family to help support the Queen’s official duties.

CBC News

John McCain selfie with ISIS posted

On Memorial Day in 2013, John McCain, senior United States Senator from Arizona and Republican presidential nominee in 2008, went on a secret trip to Syria to meet with the rebels who were fighting against Bassar Assad.

At the time, McCain described his visit as ‘moving.’ During an appearance on CNN, McCain elaborated on his experience.

“It was a very moving experience to meet these fighters who have been struggling now for over two years. And they’re very aware of the battlefield situation and they’re very disturbed about the dramatic influx of Hezbollah fighters, more Iranians, and of course, stepped-up activities of Bashar Assad.”

McCain posed for pictures with these rebels, smiling as the camera snapped. Now, ISIS, Islamic State of Iraq and Syria formerly known as Al Qaeda in Iraq, is using those pictures as a campaign ad.

The ISIS terrorists are thus using Republican politicians to advance their cause.

Source: TPNN

Nazi-themed cafe reopens

A Nazi-themed cafe in Indonesia reopened on Saturday with its walls still bearing swastikas and a painting of Adolf Hitler.

Ninety percent of Indonesia’s 250 million people identify as Muslim, making the country home to the world’s biggest Islamic population.

The owner voluntarily shut down his SoldatenKaffee last year after media reports exposed his swastika-clad establishment, prompting death threats and accusation of inciting racial hatred.

Following the closure, his lawyer told AFP that the cafe would reopen with a broader World War II theme.

“All aspects of the SoldatenKaffee are legal. We have a lot of customers from Europe and they don’t have a problem with the World War II theme, because it is seen here from a historical perspective,” the owner said.

Africans in World Cup Soccer match-fixing scandal

Ghana has been exposed as agreeing to take part in international football matches organised by match fixers.

An undercover investigation found that the President of Ghana’s Football Association agreed for the team to play in international matches that others were prepared to rig.

The team is currently competing in the World Cup finals in Brazil, and on Saturday pulled off a 2-2 draw against Germany. A team launched a six-month investigation into match-fixing after receiving information that some football associations rigging scores in international games.

Christopher Forsythe, a registered Fifa agent, along with Obed Nketiah, a senior figure in the Ghanaian FA, boasted that they could employ corrupt officials who would rig matches played by Ghana.

Forsythe and Nketiah agreed on a contract which would see the team play in the rigged matches, in return for payment. The contract stated that it would cost $170,000 for each match organised by the fixers involving the Ghanaian team, and would allow a bogus investment firm to appoint match officials, in breach of Fifa rules.

Forsythe said that match fixing was “everywhere” in football and that he could even arrange rigged matches between Ghana and British teams.

He also listed a number of African and European countries, adding “we can look for match officials who will sing to our tune”.

Forsythe and Nketiah introduced the undercover team to Kwesi Nyantakyi, the president of the Ghana FA, at a five-star hotel in Miami earlier this month shortly before his team played South Korea in Miami before heading to Brazil.

During the meeting in Florida, the president agreed to a contract that would cost the investment company $170,000 and that they could appoint the match officials for each game.

During the meeting, the president suggested that the fictional investment company put on two matches after the World Cup to prove that they were able to organise games.

Officers from the National Crime Agency, Britain’s FBI, have asked Fifa to issue an alert over attempts to rig the game. Insiders say match-fixing is widespread. It is happening at every level and in many countries.

Match-fixing syndicates have infiltrated all levels of football and sport from national, regional and onto international.

Over the last month, Sepp Blatter, the president of Fifa, has faced calls to stand down after it emerged the former Qatari executive committee member had made millions of dollars in payments to Fifa officials.

Jack Warner, one of the people that participated in the decision to award Qatar the 2022 World Cup, was paid $1.2 million shortly after the vote.

Are cars in SA too pricey?

Not really, says Motormanpete

On the face of it, and certainly the emotional response will always be a resounding yes!

While SA seems expensive it may be because we are basing our opinions on misguided ramblings of people who have not done their research.

A Toyota Yaris costs less in some obscure country than in South Africa but when you have a look at the big picture, our cars are on balance, very competitively priced.

Don’t believe me? Firstly let’s get rid of the “cars are so cheap in America” issue. Cars are cheap in America because they sell upwards of 20 million of them per year – its simple economies of scale.

But have you looked at how much more cars cost in some European countries? Check out the pricing of the Mercedes-Benz A250 7 G-Tronic: South Africa: R450 900, Portugal: Euro 42 700 (R619 150), France: Euro 36 300 (R526 350), Germany: Euro 38 437 (R557 336), UK: GBR 26 640 (R717 681).

Cough, splutter! The Mercedes is cheaper in South Africa.

Granted, this a small sample, but the point is clear. There are simply too many manufacturers present in the market for there to be room for much pricing abuse.

With over 50 brands and thousands of models on offer – it’s way too competitive out there.

All things aside, did you know that the 70th percentile benchmark dealers are lucky to achieve a 3% PBT? That makes the business very, very marginal and frankly I would invest my money somewhere else.

So if you want to question whether we are getting ripped off, let’s have a look at a few other industries.

Our cell phone calls are some of the most expensive in the world. Don’t even mention Apple computers.

And a litre of coke by the way costs more than a litre of petrol or a litre of beer. Why? Both the latter have far more complex processes and to add insult to injury, a litre of soda water costs the same as a coke.

DSTV must rank as one of the bigger rip-offs. But then they do have an absolute monopoly so when they stop flighting movies on TV made this century and put all the good stuff on Box Office at extra cost – what can we do?

But the ultimate problem does not lie with the pricing itself. The harsh reality is that all these products and services seem so expensive because we earn so little compared to Europe and the US.

So next time you question pricing in South Africa, don’t immediately jump to conclusions about everybody being a rip-off.

It may be a case of confusing “expensive” with “can’t afford”. Not all of us are ANC-cadres.

Al-Jazeera journalists sentenced to 7 years in Egypt

Three Al Jazeera journalists have been sentenced to seven years in jail after an Egyptian judge found them guilty on charges of aiding a “terrorist organisation” by publishing lies.

The three include Australian Peter Greste, Al Jazeera’s Kenya-based correspondent, and Canadian-Egyptian national Mohamed Fahmy, bureau chief of Al Jazeera English.

The verdict — delivered to a packed courtroom in Cairo — has left Greste’s Brisbane-based family devastated.

A third defendant, Egyptian producer Baher Mohamed, received an additional three-year jail sentence on a separate charge involving gun possession.

Another 11 defendants were sentenced in absentia to 10 years.

Two relatives arrested for child rape

Two black men, aged 51 and 61, have been arrested in Koster for allegedly raping a 10-year-old relative, North West police confirmed on Sunday.

“The incident happened between 3 and 20 June 2014, at Senthumule, Koster,” said Colonel Sabata Mokgwabone.

“The child’s guardian became concerned when she realised that the child was not walking properly. The child was taken to the hospital where it was discovered that she was raped.”

The child informed the guardian that she had been raped by her two relatives.

They were arrested on Saturday and were expected to appear in the Koster Magistrate’s Court on Monday, Mokgwabone said.

Cops allow looting say Pretoria residents

A vote of no confidence in Mamelodi East police has been passed by local community members as looting of shops, and injuring and killing Somali shop owners entered its third week.

The residents said they had lost all faith in the police and could not rely on them for protection.

Community members and local business owners said they lived in fear of criminal elements after police stood by and watched as young men went on the rampage, looting shops and in the process chasing foreign shopkeepers out of the township.

More than 300 Somali nationals have fled the informal settlements of Mandela Village, Phomolong and Nellmapius in Mamelodi East.

Businessmen told the Pretoria News they lived in fear of being attacked and having their businesses looted, saying they hardly slept at night worrying that they too would become victims once the youths ran out of foreign shops to loot.

“Soon there will be no foreigners to attack and no foreign-owned shops to ransack, and they will turn on us, and who will protect us?” asked one.

The looting began on Saturday three weekends ago, when youths swept through the informal settlements under cover of darkness, targeting Somali-owned shops, taking everything.

“We are effectively left with no shops to buy from; these people provide a service no local person has mastered,” a community member said.

Somali shop owners said they stood and watched while their shops were cleared, while others were beaten up and left inside shops which had been set alight.

They accused the police of standing by while the criminals looted and attacked.

Locals reiterated the claims of the foreigners, saying they saw police officers watch and do nothing as shops were looted.

Source: Pretoria News

Pagad warns SA police to take crime seriously

Residents of Mitchells Plain say they are fed up with the drug trade, gang rivalry and complicit cops.

Cape Town in the Western Cape has become a major crime hub.

People Against Gangsterism and Drugs (Pagad) said they will take the law into their own hands if the police fail to intervene.

The meeting was attended by about 200 residents. It took place at the Freedom Park Community Hall on Sunday to discuss ways to eradicate crime in their neighbourhood.

The meeting followed the death of teenager Annestley Hartnick, 16, who was shot multiple times in front of his family’s home on Saturday night.

He was one of two people shot dead at the weekend.

Pagad co-ordinator Mogamat Keraan said the community was tired of being held hostage by gangsterism.

“We will inform the police of the known drug houses and tell them if they don’t do anything we will shut them down ourselves,” said another Pagad member.

The community will meet again on Thursday.

Mandela’s funeral: Complete chaos, bad planning, wasted money

Nelson Mandela’s long-serving personal assistant has described the “chaos” around his funeral and bickering over his legacy in a hard-hitting memoir.

Zelda la Grange, who was Mandela’s assistant for almost 20 years, paints a picture of ANC politicians and his family clamouring to use Mandela for their own ends as he lay dying and during his funeral.

“I had never experienced such chaos,” she wrote of Mandela’s memorial service, laying in state and funeral, saying that plans were changed every few minutes.

“No one really knew who was in charge. One could not help but wonder whether it was just eight years of bad planning, wasting money on foreign travel to consult with other countries about events of this magnitude, or whether it was a deliberate attempt to exclude from Mandela’s funeral people who were not allied with the right people.”

La Grange also describes suspicions that her phone and that of others close to Mandela were tapped by South Africa security agencies, which may have also placed two agents on Mandela’s medical team.

Mandela’s daughter Zindzi as well as Mandela’s eldest grandson support La Grange.

Mandla Mandela said “I think, my grandfather is definitely at this hour …looking down with a big smile.”

Among the guests at the book launch were Mandela’s former anti-apartheid struggle comrades — the frail and ageing George Bizos and jail-mate Ahmed Kathrada.

Nobel laureate and retired archbishop Desmond Tutu said La Grange’s “utter devotion to Madiba was so, so obvious to anyone who beheld it. It was a very heartwarming thing.”

Source: The Citizen

Building in Midrand collapses

A building has collapsed in Midrand, South Africa. Netcare911 tweeted that two were injured in the collapse.

The tavern by Midrand Taxi Rank, called Ipintombi, collapsed but police are still unsure of the cause and said that until a full investigation had been conducted they could not speculate on what happened.

Social media sites were abuzz with members sharing what they heard and felt.

Midrand Reporter‘s BBM user Esmeralda Kerlen who lives in President Park said there was a big bang and “shockwave”. “My first thought was I hope whatever explosded does not contain nasty fumes.”

Anton, who also lives in President Park said, there as “an almighty bang”. He believed it was an explosion. “I can’t see a building collapse make such a loud explosion nose,” he said.

He appealed to the community to be on the lookout for an Emu, which ran away from his property at the sound of the explosion.

Angel, who lives in Halfway Gardens close to Midrand High School said she also heard a noise and she thought someone was breaking into one of the houses in her complex as she heard windows breaking.

“My home was vibrating and my windows were shaking. I just hope no one got hurt in the building [collapse].”

Vusi Ngqwababa said he thought it was an electric cable that exploded or a bomb.

Shazia said, “My husband and I heard the sound last night. We got up with a fright and felt a slight tremor. We thought it might be a small earthquake.”

Source: Midrand Reporter

President for sale

President for sale. This was the tagline of a Gumtree ad that disappeared soon after it was posted – but not before doing the rounds on social media.

The tongue-in-cheek advert was posted on Thursday by username Average Joe.

Featuring a picture of President Jacob Zuma, it offered him for sale, either for a price or a replacement.

The text of the ad humourously implored readers to make an offer.

“Desperately in need of a functioning president. This one costs too much to maintain. Will take whatever we can get at the moment… just make an offer.”

The ad said the seller was willing to “swop for smarter/cheaper model”, but would not entertain offers from chancers – “only barcode ID holders or TAX payers please”.

Source: IOL