FNB plans to more than double its financial adviser network
First National Bank (FNB) plans to expand its financial adviser footprint by more than half over the next three years as it leverages its retail banking presence to cross-sell more insurance and investment-related products, BusinessLive reports.
The retail banking unit of JSE-listed FirstRand has about 650 tied financial advisers. It wants to expand that number by 53% to more than 1 000 in the medium term as it expands its in-house insurance and investment offering.
The plan to roll out more advisers is part of a broader strategy to convert its private bankers into financial advisers who provide a more holistic service to its high-end banking customers, Bheki Mkhize, the chief executive of FNB Wealth and Investments, told BusinessLive.
FNB said it also plans to use its app and network of 611 branches across South Africa to extend its client reach.
Lee Bromfield, the chief executive of FNB Life, said extracting more efficiencies and productivity out of advisers, as well as FNB’s product suite, is essential given South Africa’s stagnant economy and shrinking savings pool.
Full BusinessLive report (subscription required)
Warning about extending mortgages to fund solar installations
Standard Bank says the average cost of installing a solar power system in one’s home is about R170 000. The figure is based on the spending patterns of at least 250 consumers who used Standard Bank’s LookSee platform to buy solar power systems, BusinessLive reports.
The bank says the true number of customers opting for solar installations to cope with blackouts is probably far higher, as not all of them use the online homeowner’s tool.
The bank’s analysis of expenditure patterns shows that about 80% of the cost of a solar installation is typically funded by customers extending their home loans, and the balance is financed either by unsecured loans or savings.
The bank warns that extending one’s mortgage to fund a solar power system is not an optimal use of credit, given the interest incurred over the decades-long mortgage repayment period.
The high cost of solar power installations is the main reason for most consumers opting to extend their mortgages to finance their solar installations, a strategy the bank warns is not fiscally prudent. Instead, customers should consider financing such installations over eight years, which is more in line with the typical lifespans of solar power solutions.
Full BusinessLive report (subscription required)
Bank employees sentenced for defrauding JSE, Samancor Foundation
The Mokopane Regional Court has sentenced three bank employees to 15 years’ imprisonment each for defrauding the JSE and Samancor of funds amounting to R190 million, TimesLive reports.
The court heard how the syndicate operated in their capacity as Absa employees in Limpopo and Gauteng when they accessed the portfolios of JSE Trustees and Samancor Foundation without authorisation.
National Prosecuting Authority spokesperson Mashudu Malabi-Dzhangi said that on July 26, 2019, the accused misrepresented to Samancor Foundation, or Absa, that they were authorised to transfer R2.9m, made changes to the JSE’s banking portfolio and added their own.
“On August 12, 2019, a transfer of R30m was made from Samancor Foundation, and on September 23, 2019, an overall amount of more than R158m,” she said.
Absa had to reimburse the JSE and Samancor Foundation a joint amount of R191 108 910, said Malabi-Dzhangi said.
Possible ANC-EFF coalition worries investors, says Investec CE
South Africa’s political climate is the most uncertain since the end of the apartheid era, with investors concerned about a potential coalition between the ANC and the EFF after next year’s elections, Investec Bank’s chief executive, Richard Wainwright, said in an interview with Bloomberg TV on 12 April.
If the ANC falls short of the 50% it needs to retain control of the government, it may tie up with the EFF, which wants to nationalise the banks, mines, and land.
“There’s probably the highest level of uncertainty politically that we’ve had since 1994,” Wainwright said. “It does appear that they [the ANC] are siding in certain instances with the EFF. That will be very negative for international investors and domestic investors.”
The political uncertainty is a deterrent to foreign investors, Wainwright said. He spoke a day before President Cyril Ramaphosa hosts an annual investment conference after setting a target in 2018 to attract R1.2 trillion of investment.
“We expected the current president, when he came into the presidency, to accelerate reforms, but, unfortunately, we’ve not seen that,” Wainwright said. “I think the level of uncertainty on the politics will again make it very difficult to currently attract a significant investment both international and domestic.”
