In brief

1 June 2021

Australian financial service firm IOOF has completed the acquisition of MLC Wealth from National Australia Bank (NAB).

The $1.4bn deal was announced by NAB in August 2020.

MLC Wealth comprises financial advice, platforms, superannuation and investments, and asset management businesses.

Following the completion of the deal, IOOF has approximately $500bn in funds under management, administration and advice. The transaction adds 406 advisers to IOOF’s roster. The company will now serve approximately 2.2 million clients.

IOOF CEO Renato Mota said the acquisition positions the firm as the leader of a new era of wealth management in Australia.

Mota added: “IOOF and MLC share a common purpose to improve the financial wellbeing of all Australians We also share a client-oriented philosophy and together, we will now be proudly serving over 2.2 million Australians.”

28 May 2021

South Korean insurer Samsung Life has agreed to buy a 25% stake in UK-based Savills Investment Management (Savills IM), a subsidiary of real estate services provider Savills, for £64m ($90.8m) in cash.

The deal is part of Savills IM’s ‘strategic investment alliance’ with Samsung Life and its real estate asset management subsidiary, Samsung SRA.

As part of this agreement, Samsung Life will commit $1bn capital to Savills IM’s investment strategies to seed and co-invest in real estate equity and debt strategies across Europe and Asia.

This capital is also intended to help Savills IM secure additional capital from investors in South Korea as well as the Asia-Pacific region.

The agreement also provides Samsung Life with the option to increase its interest in Savills IM by up to a further 10% if a minimum of $2bn is committed over time.

The transaction is expected to close in the fourth quarter of the year, subject to regulatory approvals.

As part of the agreement, Samsung SRA will work to add additional Korean client capital to Savills IM’s products.

28 May 2021

Julius Baer Group has agreed to pay around $80m to resolve a US investigation over corruption linked to world soccer federation Fifa.

The Swiss banking group found itself in trouble after accepting money from corrupt Fifa sources. The corruption is said to have involved officials and affiliates of Fifa as well as associated sports media and marketing firms.

The firm has been charged with a money-laundering conspiracy in the US.

The banks said that it has finalised the agreement reached with the US Department of Justice in November 2020 to settle the charges related to the scandal.

Following a deferred-prosecution agreement, the authorities agreed to drop the charges against the firm in three years if it meets a certain condition.

Julius Baer will pay $43.3m in fines and a $36.4m forfeiture to settle the probe.

28 May 2021

AMP Australia is reportedly preparing to slash its headcount by up to 20% over the next year as it looks to restructure the business under a new executive leadership team.

Australian wealth manager AMP hired ex-Sunsuper CEO Scott Hartley as head of AMP Australia last December, replacing Alex Wade who resigned following misconduct allegations.

AMP established AMP Australia in 2019, consolidating its domestic wealth management and banking units. The unit specialises in superannuation, banking and wealth management services.

Hartley is looking to create a "lean, efficient and competitive" business, and brought together a new executive team last month to accelerate the firm’s restructuring plans, reported The Sydney Morning Herald.

Job cuts are part of this plan, and the company aims to save $300m under its three-year cost savings project which is set to conclude next year.

27 May 2021

Robo adviser Wealthify has teamed up with open banking platform Tink to transform the way its investors transfer money into their investment accounts.

Wealthify has integrated Tink’s payment initiation service technology in its app.

The integration will allow investors to transfer an initial investment sum during the onboarding process, and then make additional payments to top up their accounts.

27 May 2021

Schroders Personal Wealth (SPW) has appointed Marcelo Rodrigues as head of business development for Scotland and Northern Ireland.

In his new role, Rodrigues will lead SPW’s brand and marketing activities across Scotland and Northern Ireland. He will also be responsible for developing strategic partnerships to support business growth.

Most recently, Rodrigues was business development director at an Edinburgh-based boutique wealth management firm, where he also offered financial advice to HNW clients. Prior to that, he held senior management positions at Royal Bank of Scotland and Lloyds Banking Group.

SPW regional director for Scotland and Northern Ireland Donald Gateley said the new appointment reflects the firm’s continued commitment to Scotland and Northern Ireland, and builds on its long-term regional growth strategy to widen its UK offering.

27 May 2021

US-based RIA aggregator Mercer Global Advisors has expanded its reach to Mississippi with the acquisition of Starkville-based wealth management firm ET George Investment Management. Financial terms of the deal were not disclosed.

The acquisition adds approximately 155 clients and $170m in assets to Mercer Advisors.

Founded in 1974 by Ernie George, the acquired firm provides comprehensive wealth management services to its clients.

As part of the deal, the entire George team will join Mercer Advisors.

25 May 2021

UK-based legal practice Fladgate has launched a family office division in London to offer professional administrative services to its private wealth clients.

The firm set up the new venture under its newly launched Walgate brand, which aims to offer non-legal professional services to clients.

Walgate Family Office will provide a range of administration support for affluent families.

24 May 2021

Absa Group is reportedly pursuing talks with African insurance giant Sanlam for the sale of its asset management unit.

The deal, if it materialises, could create a firm with more than ZAR900bn ($65bn) in assets, Bloomberg reported citing sources familiar with the talks.

Absa is said to be in discussions with both Sanlam and its partner, African Rainbow Capital Investments, for a deal. ARC purchased a 25% stake in Sanlam’s asset management arm last year.

The sources, who asked not to be named because the discussions are private, said the companies have not reached any decisions regarding the deal, and that an agreement may not be finalised.

Sanlam Investments had about ZAR649bn in assets under management as of the end of the last year.

Absa is believed to be the third-largest lender in South Africa.

24 May 2021

Chinese banking regulator has imposed a total fine of CNY366m ($56.8m) on five banks for breaching multiple rules and regulations.

The move was reported by the South China Morning Post citing a China Banking and Insurance Regulatory Commission (CBIRC) statement. The five penalised banks are Huaxia Bank, China Bohai Bank, Bank of China, China Merchants Bank and The Bank of East Asia’s unit.

Huaxia Bank was fined CNY98.3m for failing to inform clients about potential risks in investment products as well as lapses in wealth management. CBIRC imposed a penalty of CNY97.2m on China Bohai Bank for bank acceptance bill management failures and wealth management wrongdoings.

In September last year, CBIRC penalised five financial institutions CNY320m for market irregularities.

The latest step comes as China ramped up efforts to mitigate financial market risks to stabilise the economy.

The publication quoted the regulator as saying: “The CBIRC will maintain high pressure on violation of laws and regulations.”

The local authorities are also empowered to reduce bad loan ratio of smaller banks and lower financial risks. Last month, it was reported that the central bank of the country decided to stress test all 4,024 banks.

The annual stress test programme simulates scenarios to assess the resiliency of the lenders. Chinese Vice Premier Liu He recently also asked smaller and local lenders to ramp up risk management.