We operate under four business divisions.
- Old Mutual Emerging Markets – providing innovative long-term savings, protection, investment and lending solutions
- Nedbank – providing a wide range of wholesale and retail banking services and a growing insurance,
asset management and wealth offering
- Old Mutual Wealth - providing integrated wealth management products, services and advice, combining asset management as well as saving and investment solutions
- Institutional Asset Management - providing a diverse range of investment strategies and products, operating as OM Asset Management in the United States, and delivered via a multi-boutique model to institutional investors.
Old Mutual Emerging Markets
“Solid operational delivery and strategic progress in Africa.”
Improved life expectancy
HIV/AIDS is considered one of the most prevalent causes of deaths in South Africa. However, due to the increased use of anti-retroviral treatment, people who are HIV positive are now living longer and the insurance industry (including Old Mutual) is paying fewer death claims, particularly in the low income market.
The improvement in mortality experience of Old Mutual South Africa (OMSA), has led to the following:
Launching an innovative new funeral product range that requires no medical underwriting and provides customers with excellent value for money. Key features of the new products are:
- Lower premiums for customers: eg a typical 33 year old will pay 20% less in premiums under the new funeral range
- Higher cover levels
- More regular cash-backs whilst maintaining profitability to the shareholder.
- Enabling existing customers to benefit from the improvement in long term mortality experience: eg for the 2014 cover reviews, 322 916 low income market customers received increases of up to 17% of their sums assured.
OMSA has recognised the significant improvement in the life expectancy of their customers as a result of health care intervention in South Africa, and has responded by developing products that are more affordable, more competitive and attractive, without compromising the interests of the shareholder.
“Strong headline earnings growth of 14% and good progress with our five strategic focus areas.”
Fair Share 2030 – building a better society
To be a thriving bank in the long term, we need to operate in a thriving society. Fair Share 2030 is Nedbank’s strategy to get money working for the future we all want. It provides an annual flow of funding – starting with a target of R6 billion in 2015 – to support new products, services, and projects that promise to deliver progress towards defined social and environmental goals.
We want this lending to enable outcomes that would otherwise not have happened – so that we actively contribute to closing the gap to the future we want, rather than merely reclassifying existing business. A Proof of Concept phase conducted in 2014 generated important insights that have informed our business planning and will prove invaluable as we scale up through 2015 and beyond. In particular, we now understand better how new products and services can be developed and new partnerships created to drive intentional non-financial impacts while still generating a decent financial return.
Old Mutual Wealth
“Strong delivery while significantly transforming our business.”
Sustainable investments for sustainable returns
At Quilter Cheviot, we noticed investors were realising that financing companies which provide the products, services and technologies to deliver a cleaner and more efficient economy can deliver strong investment performance. In response we launched our sustainability investment strategy, the Climate Assets Fund, in March 2010. The Climate Assets Fund seeks to achieve long-term capital appreciation and income through multi-asset allocation – investing in global equities along with fixed interest and other alternative investments such as green infrastructure funds.
The investment focus is on companies offering solutions to the emerging global challenges of delivering ‘more with less’ for a rapidly growing population with a finite supply of resources in a carbon constrained environment. Current investment examples include companies involved in railway transportation, energy efficient solutions, water infrastructure, recycling packaging, and organic and natural food. It was named Best New Entrant in the Climate Change 2010 Awards and, more recently, was shortlisted for a performance award at the Professional Adviser Awards 2015.
Institutional Asset Management
“A successful IPO, strong net client cash flows of $9.5 billion and AOP up by 32%, as business momentum continues.”
Enhanced financial flexibility
Following its successful IPO, OMAM has been trading on the New York Stock Exchange since October 2014. The IPO will enhance OMAM’s financial and operating flexibility to deploy capital to continue to grow, develop further its multi-boutique asset management business and provide the Group with enhanced financial flexibility. The IPO included 22 million OMAM shares at $14 a share. The underwriters also exercised an overallotment option on a further 2.2 million OMAM shares, reducing Old Mutual plc’s shareholding to 78.8%. The gross proceeds for the Group from the IPO process totalled £317 million, including the pre-IPO dividend.