The largest wealth managers in Africa

The African wealth management market is valued at US$132 billion (as of December 2016). Around US$76 billion of this is held in South Africa.

The following table lists the main players in the African wealth management space, ranked by Africa sourced “assets under management” (AuM).

The wealth consumer has drastically changed from traditionally known industries which include resource production to alternate consumer driven industries such as hotel, luxury, information, telecoms, property, retail and entertainment industry.

The investment pool is small in comparison to the global field but it is significant growth in a continent of more than 50 countries.

South Africa leads in wealth management in Africa and countries such as Kenya are increasingly growing in attractiveness and a vibrant wealth management industry is growing with companies such as UBS deeply entrenching themselves in it. Tunisia and Algeria are following suit as wealth management countries.

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Africa: Largest wealth managers by AuM, 2016
Rank by Africa sourced AuM Base African AuM (US$ billion)    
Investec SA / UK 24,0
RMB SA 11,0
UBS Swiss 8,0
PSG SA 7,0
Nedbank SA 6,0
Sanlam SA 5,0
Credit Suisse Swiss 4,0
Standard Bank SA 3,0
ABSA (Barclays) SA / UK 3,0
Old Mutual SA 2,0
Momentum Group SA 2,0
Citadel SA 2,0
Note: Ranked by AuM at the end of Dec 2016. Rounded to nearest billion.

 

 
Source: Annual Reports, Investor presentations

Key findings:

  • Approximately US$132 billion of African wealth is tied up with wealth management companies.
  • South Africa (mainly Johannesburg) is the hub for African wealth management with US$76 billion in AuM.
  • We estimate the African wealth management market will grow by 7% per annum over the next 10 years.
  • The most promising emerging African markets for private banking are Mauritius and Kenya.

Family offices

Family offices are the fast growing wealth management segment in Africa and throughout the world.

Family offices provide a far more personalized service than normal wealth managers. Additional services they offer include: managing household staff, property management, philanthropy coordination and managing family education.

Typically family offices are exclusively for family members and their related trusts, foundations, charities, non-profit organizations and family-related investment vehicles.

Single-family offices (SFO)

Single-family offices generally take the form of a private company that manages the investments and trusts of ultra-wealthy individuals (normally with net assets of more than US$100 million) and their extended family. Typically, an SFO has a small team consisting of a lawyer, an investment specialist and an accountant.

Multi-family offices (MFO)

There are a significant number of families with between US$30 million and US$100 million in assets that do not have the economies of scale to establish stand-alone family offices. MFOs cater to these families and allow them to share administrative costs. Stonehage Fleming is a notable MFO with a presence in Africa.

A growing consumer market creates wealth for entrepreneurs which in turn create opportunities for fund managers.  The growth of entrepreneurship in sub-Saharan Africa and Africa as a whole is fundamental to the business of fund management.

The increasing interest in Africa as a destination for investors and businesses will influence the pace of wealth generation.

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