International Investor Magazine Summer 2020

INTERNATIONAL

M A N A G I N G T H E N E X T D E C A D E O F W O M E N ’ S W E A LT H THE ROLE OF ROBO-ADVISORS

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SUMMER ISSUE

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EDITOR’S NOTE When the virus brought much of the world to a standstill, it was only natural that we thought that life would be radically and permanently altered but realistically, the world post-pandemic is unlikely to be that different from the one we knew before. So what will be COVID-19’s lasting impact? In this issue, we’re exploring some of the industries that may well have changed for good, from fashion (p.08) to cities’ prioritising pedestrians (p.30).

Some longer-term trends were accelerated by the pandemic. We became more reliant on digital services than ever in lockdown and it’s something that the industry noted. Islamic financial products and institutions are cropping all over the world (p.45) and many are using blockchain and fintech to revolutionise the way they do business (p.45). Taipei Fubon Bank has launched Taiwan’s first blockchain interbank transfer sandbox experiment (p.38).

Meanwhile, with a third of the world’s wealth under their control, women have become a sizable economic force. We spoke to Boston Consulting Group’s Anna Zakrzewski about managing the next decade of women’s wealth (p.40).

It would seem there is certainly a lot to be (cautiously) optimistic about and the recent global stock market gains are proof that many investors see a brighter economic future (p.22). If you know an organisation or individual who are working to make that future a reality and you think they deserve to be recognised, nominate them for an award!

Enjoy, Sophie Rasbash

CONTENTS

22

40

08

26

40

The Perfect Fit for Sustainability

Putting the investor first

Managing the Next Decade of Women’s Wealth

An interview with Jess Fleischer, cofounder of innovative clothing tech company, Son of a Tailor.

Banner Asset Management is an experienced asset and funds manager, specialised in the Australian real estate market.

16

30

Re-shaping the PostPandemic Future

Travelling clean postpandemic

How can business leaders build back

COVID-19 will have a lasting impact on

better?

the way we travel. How will cities and public transport respond?

22 Investing in Optimism After a turbulent few months, global stock markets are looking more positive.

38 Transforming the Customer Experience Taipei Fubon Bank is using cuttingedge technology to deliver a better banking experience.

An interview with Anna Zakrzewski, a Managing Director & Partner of Boston Consulting Group.

45 Boosting the Islamic Finance Sector with Blockchain Both the Middle East and Southeast Asia are home to a growing number of Islamic fintechs.

48 What’s up with Swiss private banks?

An update from Jan Langlo, Director of the Association of Swiss Private Banks.

52

82

Collaboration for innovation

The International Investor Awards

Innovation has been at the heart of Arca Fondi’s business model since its beginning.

We celebrate the organisations innovating and driving the world of Investment!

INTERNATIONAL INVESTOR MAGAZINE

54 Net-zero: Combining public and private investment How can the UK deliver on its net-zero ambitions?

64 Over a decade of sustainability Over a decade into their sustainability journey, Access Bank have aligned their corporate philosophy and sustainability strategy

54

64

71 Local Innovation, Global Recognition Cornèr Bank (Overseas) Ltd’s product innovation and overall client satisfaction set the pace for financial services worldwide.

74 The Rise of RoboAdvisors The growing robo-advisor trend marks a shift in how business is done.

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THE PERFECT FIT FOR SUSTAINABILITY: AN INTERVIEW WITH JESS FLEISCHER, SON OF A TAILOR CO-FOUNDER While we know that the majority of textiles end up in landfills,

Jess Fleischer: Two things. First, I saw the need as a

two Danish fashion entrepreneurs, Andreas Langhorn and Jess

buyer of T-shirts. I was asking myself: why is it that the

Fleischer, are tackling the problem of material waste upstream at the manufacturing stage. They developed an algorithm that creates a T-shirt tailored to your exact specifications. The result is Son of a Tailor, a clothing tech company with its sights now set

apparel item closest to your body did not come in more than five or six sizes? And then secondly, I had studied and worked intensely with manufacturing lines and supply

on producing the world’s first 3D-knitted pullover. We spoke with

chains and seen how things like customisation, technology

co-founder, Jess Fleischer, about how they got started and what

and just-in-time mindsets had changed industries - except

COVID-19 means for the fashion industry.

in fashion - here companies still mass-produced like we did

INSTEAD OF SEEING THE PURSUIT OF SUSTAINABILITY AS A BARRIER, SON OF A TAILOR CHOOSES TO SEE IT AS INSPIRATION FOR INNOVATION. WHAT KICKSTARTED YOUR REINVENTION OF TRADITIONAL PRODUCTION METHODS?

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100 years ago and in an extremely unsustainable way.

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T h e pe r f ect fit fo r sustainab il ity: an inter vi ew wi th Jess Flei sch er , Son of a Tai lor co -fou n d e r

HOW DID YOU GO ABOUT BUILDING AND TESTING YOUR IDEAL SIZE ALGORITHM?

HOW HAS COVID-19 CHANGED THAT? WHAT WILL BE ITS IMPACT ON THE FASHION INDUSTRY?

Besides that, there are substantial

I don’t really know. It was one of

In relation to COVID-19, traditional

those magic start-up epiphanies. We

pre-pandemic levels. Many studies

fashion brands have experienced

were annoyed how much trouble

indicate that this won’t be the case,

sudden changes in demand, many

customers had measuring themselves

so fashion brands will be forced

with a steep decline. This is painful

with a measuring tape. So we started

to provide a better online service,

for any business as there are fixed

acquiring torso measurement

including better representation of

costs that need to be covered. But for

data and after a month, our Lead

their products, better sizing options

fashion companies, it hurts all the

Developer, Jakob, suddenly said,

and a much better understanding and

more because they will have a ton

“I think I am on to something”.

service of the online customer. Take

of money bound in inventory that’s

He had found some initial unique

Hugo Boss and Ralph Lauren for

season-dependent. This is really

relationships in the data. After

example. Both have Trustpilot Scores

bad for both their economy and the

six months of iterating with our

of 1.9/5 - and they don’t even seem to

environment, as a lot of resources

customers, we had an algorithm

care.

go into producing this inventory.

that worked better than manual

Considering that many of these

measurements. Today you just need

companies have already had problems

to fill in your height, weight, age, and

with overproduction, their rule of

shoe size - for 96% of our customers,

thumb is often “we better produce

that provides a great fit.

one item too many, than one item too few”. This leads to large amounts of

THE SUCCESS OF THE KICKSTARTER THAT HELPED LAUNCH SON OF A TAILOR PROVES THAT PEOPLE ARE READY TO INVEST IN SUSTAINABLE CLOTHING. HOW DO YOU SEE THE FASHION SECTOR TRANSFORMING TO MEET CUSTOMER EXPECTATIONS?

The customer has come a long way in the last couple of years in terms of sustainability and they are demanding a change. We can actually see it in our marketing and customer support data! Unfortunately, the sector is not changing very quickly.

resources going to waste, negatively affecting the environment.

offline retail will ever go back to

Consumer fashion has been shifting towards sustainability for quite some time, in the sense that brands are increasingly focusing on essentials that last longer as well as meeting the expectations of people who want to consume less. These are trends that, I am sure, will be further accelerated by COVID-19.

COVID-19 has been a wake-up call for many of the big brands. This inventory insanity needs to stop. In 2018, H&M needed to liquidate $4 billion worth of stock - and that was in a year of economic growth! Supply chains have become too long and the topline growth targets too greedy.

Still, many brands order their apparel more than six months before they will sell them. And they would commit to fabric long before that.

Most brands still think that if they have sustainable cotton in some of their collections, they are fine. It’s sad.

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doubts about whether classic

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NOW YOU ARE EXPANDING TO JUMPERS AND LONG-SLEEVES. WHAT’S NEXT? DO YOU HAVE A SPECIFIC LONG-TERM VISION OR ANY EXCITING DEVELOPMENTS IN THE PIPELINE YOU CAN SHARE?

Let’s see. The Son of a Tailor product pipeline is not expanding super fast.

We want to make sure that every launch is perfect and provides the perfect fit. But there are indeed many subcategories within t-shirts, jumpers and knitwear to come!

T h e Bah amas:

THE BAHAMAS: THE JURISDICTION OF CHOICE

THE BAHAMAS: THE JURISDICTION OF CHOICE Any country heavily engaged in

The financial services sector has been

The vital features at the heart of

financial services bears a responsibility

impressively resilient and progressive

what distinguishes The Bahamas as

and commitment to the international

in the face events such as Hurricane

an international financial centre of

community with which it is intricately

Dorian, the current COVID-19 pandemic,

significance are: Expertise, Innovation and

involved, the financial institutions

international initiatives, and in midst of

Location.

operating within its borders, the clients it

the continued and sometimes challenging

serves and its citizens which rely on the

evolution of the global industry.

sustainability of the industry for continued

Everything The Bahamas offers is defined by these three words. Everything that

economic development. The Bahamas is

None of these challenges has impeded

comprises The Bahamas’ value proposition

such a country.

the country’s financial services industry

and continued success as a leading

f rom conducting business and delivering

international financial services centre is

The Bahamas has always sought to

bespoke solutions to meet changing and

guided by these distinguishing factors.

provide superior financial products

diverse client needs. Robust business

and services and a world-class client

continuity plans that are in place with

EXPERTISE

experience. It has proven itself to

all financial institutions have allowed

With a track record spanning more

be nimble and responsive to global

business to continue both during

than 80 years in financial services, few

changes – always mindful of the need to

Hurricane Dorian last autumn and now

jurisdictions offer the wealth management

adhere to international standards with

as the world deals with COVID-19. The

experience that The Bahamas has to offer.

respect to compliance, cooperation and

foresight evidenced by vigorous business

This heritage is the basis for the strong

transparency. This is complemented by

continuity measures has clearly worked to

legal framework that has been cultivated

the fact that The Bahamas is not only

cushion the implications of these events

for financial services, an investment

somewhere that offers bespoke private

and reinforces why the country is seen

climate that has been nurtured through

wealth management, it is also a beautiful

by many as an ideal location for financial

years of maturity, and a stable and

place to live and work.

institutions and the services they provide

predictable business environment,

to their international client base. This

anchored by the thousands of Bahamian

adaptability has been especially evident

wealth management professionals

in the Bahamas’ response to international

who work side-by-side with expatriate

initiatives, which has ensured adherence

colleagues in the more than 250 financial

with the highest standards of compliance

institutions that call The Bahamas their

with every internationally agreed standard

home.

The Bahamas is the leading international financial centre in the Latin America and Caribbean region, respected for its expertise in fiduciary services.

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of conduct.

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INNOVATION

LOCATION

Market responsiveness has long been a

The unique geographical location of the

part of The Bahamas’ DNA as a forward-

Bahamas, just 50 miles off the coast of

thinking international financial centre and

Florida and positioned as the gateway

has been the basis of legislation creating

to the wider Americas, is an undeniable

innovative, client-centric products and

advantage for The Bahamas. Its proximity

services in a modern, compliant regulatory

to the U.S., Central and South America

regime. Such innovation can be seen in

places The Bahamas in an enviable

the country’s evolving and often ground-

position to serve both traditional and

breaking trust legislation. It led The

emerging markets and presents an

Bahamas to become the first common law

opportunity to link commercial and

jurisdiction to introduce foundations. It

financial interests.

services sector ensures that the integrity of The Bahamas as an international financial centre is maintained.

As a sovereign nation for more than 40 years, successive governments have consistently demonstrated the country’s commitment to international best practices, cooperation in the administration of justice, international tax transparency, anti-money laundering and the countering of financial terrorism initiatives.

sparked the Bahamas Executive Entity and has thrust The Bahamas to the foref ront

In recent years, as more and more

of the investment funds industry with

individuals have chosen to “follow their

the introduction of SMART Funds and the

money” with respect to where they live

Expertise, innovation and location

Investment Condominium (ICON) fund.

and work, The Bahamas, with its tropical

are the pillars of financial services in

environment, has become the preferred

The Bahamas. Combined, they form

choice for many who yearn for an

a compelling reason to consider The

excellent quality of life whilst being able

Bahamas as the place to do business and

to manage their financial affairs. Most

will continue to guide the jurisdiction’s

importantly, individuals, family offices

pathway to be a provider of unparalleled

and institutions will find a warm welcome

financial products and client experience.

With this innovative spirit, it should come as no surprise that the country’s once-dormant insurance business has re-emerged as a sought-after destination for captives.

THE JURISDICTION OF CHOICE

when they come to The Bahamas as the country is committed to using its natural resources and cultivated assets to create

The innovation experienced in the sector is fuelled by a progressive investment climate that seeks to place financial services in the context of development.

an environment that is attractive in terms of both business and leisure. Few competitive jurisdictions can offer the business and lifestyle combination The Bahamas provides naturally. Moreover, the strong regulatory regime that characterises the jurisdiction’s financial

I N T ER N AT I ON AL I NVESTOR MAGAZ INE

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THE FUTURE OF ACTIVELY MANAGED CERTIFICATES

220m Actively Managed Certificates currently oustanding

WHO WE ARE

WHAT WE DO

An Institutional team

• Offer a flexible and integrated

created in 2014, grew

trading setup in a one-stop

from 2 to 6 highly

shop

qualified people, with diversified

• Structure products and

bespoke solutions for all asset

backgrounds, each in their own field, from trading to sales, from legal to operations.

classes

•

Distribution and access to established network of institutional clients

1.3bn Raised from institutional clients globally

70 Structured products sponsored in 3 years

AMC size Outstanding (CHF mln)

All types of possible investment strategies, converted into a liquid marketable instrument

145

220

175

110 60 8

25

H2 H1 H2 H1 H2 2020 H1 2017 2017 2018 2018 2019 2019 YTD

Number of Products H1 2017

6

H2 2017

Constant growth due to a sustainable business model and a flexible onestop shop approach

14

H1 2018 H2 2018 H1 2019

28 35 51 61

H2 2019

70

2020 YTD

Customers’ Geographic Segmentation

Innovative and highly technological business leveraging on a solid and fully diversified network of institutional clients

Central America

Switzerland

European Union

Trade Finance

Renewable Energy

Agriculture

Real Estate

Bespoke financing solutions tailored to the needs of our clients and suitable for a diverse range of projects in the real economy

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RE-SHAPING THE FUTURE AFTER COVID-19

BY ANDIA RISPAH RE-SHAPING THE FUTURE AFTER COVID-19

by Andia Rispah

TRANSFORM GLOBAL HEALTH AND DEVELOPMENT

However, this kind of work is complicated

immense proportion, it’s a catalyst for an imminent restructuring of the global

The COVID-19 pandemic has disrupted

supply chain logistics, safety, and financial

economic order.

the global health and development

stress. Every country has had to struggle

community. The world’s attention has

with a lack of equipment and supplies to

It offers individuals and organisations a

shifted to organisations fighting infectious

test and protect against COVID-19.

chance to reset and re-shape the world

diseases, health workers, delivery of social

towards sustainability. Here’s how business

services, and protecting livelihoods.

COVID-19 is more than a health crisis of

by challenges in terms of accessibility,

leaders can hasten this vital transition.

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Re - shaping th e futur e af ter COVI D -19

REVIVING AUTOMATED DOMESTIC MANUFACTURING

The resilient companies had

and development institutions, priorities, and occupations? Every country will

Western countries relied on off-shore

have to re-examine their supply chains

flexibility, cut costs, and built a

supplies for necessities, but now they

for critical health and livelihood related

can see the downside. Governments will

growth foundation to capture market

products. There will likely be a surge in

certainly revise domestic manufacturing

producing pharmaceuticals, equipment,

as part of their plan to build up strategic

and medical supplies locally. Countries

resilience after the current crisis.

So how will the pandemic re-shape health

without the existing capacity will want

created financial and operational

opportunities after the crisis.

They had invested in software technologies, which gave them greater

to develop the tools needed as soon as

Automation will be a crucial component

possible.

predictability and efficiency - giving them

in reviving domestic manufacturing.

a competitive edge. Recent advances

Advanced automation and robotics

in AI and IoT technologies have enabled

will drastically increase productivity in

therapeutics, vaccines, and non-

tremendous efficiencies in predictability,

manufacturing processes. Automated

capacity, availability, and flexibility

medical methods of prevention.

manufacturing will replace low-skilled

of supply chain and manufacturing

labour with new jobs and opportunities for

operations. Digitisation is a fundamental

This could mean preventing deaths,

digitally savvy workers.

element for building sturdy chains. It

More countries will invest in research,

economic losses, and livelihoods for

makes the identification and recruitment

millions of poor people around the world.

DATA INFRASTRUCTURE WILL BE A STRATEGIC ASSET

A GOLDEN OPPORTUNITY IN THE GLOBAL SUPPLY CHAIN

The pandemic has made accessibility

McKinsey found that companies that

to reliable, real-time data an absolute

embraced these technologies earlier were

The COVID-19 pandemic has hit

necessity, especially when it comes to

already seeing a 7% growth in revenue

investment and global trade at an

coordinating the right medical response.

over their peers.

unprecedented speed and scale.

Data will become a more strategic

Multinational companies faced an initial

resource across multiple facets of business

COVID-19 has caused an economic and

supply shock and later a demand shock as

and community.

social downturn, but it will create a much

more countries ordered people to stay at

of new suppliers far less time-consuming.

deeper divide between companies who

home. Individual consumers, businesses,

This requires a significant investment

have just started to digitise and those

and governments struggled to procure the

in data connectivity, acceleration in

further along in their digital journey.

necessary materials and products.

developing the 5G networks and push for

The healthcare sector’s scramble for

indicators. It means the manufacturing

A SHIFT TO VIRTUAL COLLABORATION

protective equipment laid bare the

sector will significantly accelerate the

Manufacturers still require people to

inherent risks of inventory and single-

deployment of industrial IoT. Such

work physically on-site; operators to run

sourcing models driven exclusively by cost

advancements include sensing, data

machines, and maintenance staff to

control. As Chinese factories were closing

visualisation, remote collaboration

repair and maintain them. Contactors and

down, manufacturers struggled due to a

tools, and AI-based insights across their

external vendors need to access the site

lack of flexibility in their supply base.

operations.

to support operations. However, social

It forced every country to conf ront the

Data is a strategic asset to companies

f ragility of the modern supply chain. To

and a key factor in their competitive

reflect on its dependence on the rest of

advantage.

valuable insights into leading economic

distancing measures could render nearly

the world to maintain its way of living.

Now countries have the opportunity

DIGITISATION WILL BECOME A COMPETITIVE ADVANTAGE

50% of on-site staff jobless.

Even as manufacturers face this dilemma, we will see the rapid adoption of remote diagnostic, collaboration, and management tools. It will lead to the

After the Great Recession, McKinsey

emergence of a “virtual shift.” We’ll have

diverse supply chains.

analysed the performance of publicly

a team of experts working remotely,

traded companies and found that only 10%

guiding, and supporting the reduced

Some will want to decentralise their

were more resilient to the crisis than their

“physical shift” of on-site personnel.

manufacturing capacity and consider

peers.

to design stronger, smarter, and more

local production. Policymakers also have an opportunity to consider whether certain products need local or regional manufacturing.

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Re - shaping th e futur e af ter COVI D -19

OPPORTUNITY FOR A GREENER AND MORE SUSTAINABLE ECONOMY

As the pandemic re-shapes the global

The threat of climate change has been

financial system, and as companies

gradually growing, with devastating

evaluate their diminishing returns,

effects for people and their livelihoods

investing in climate-friendly strategies

around the world. The COVID-19 crisis

could boost economic growth and create

presents an opportunity to learn the

new jobs.

lessons and reset ourselves on a more sustainable path and a new trajectory of

Most importantly, companies must place

sustainable employment.

sustainability at the heart of their business and investment strategies to avoid the

It has emphasised the importance of

pitfalls of a business-as-usual high-carbon

investing in areas such as technology and

path. It’s a business plan that’s positive for

innovation.

the environment and good for people and profitability.

It is time to align sustainable solutions with funding in a way that can transform the marketplace.

Sustainable investment will boost economic growth and employment opportunities.

THE CLIMATE CRISIS OPENS UP ENORMOUS OPPORTUNITIES. This pandemic has served to highlight that the world’s most vulnerable citizens suffer the most during times of global crises.

To repair lives after the pandemic requires billions of dollars to rebuild industries, supply chains, and create conditions for a resilient financial future. However, the global response to the COVID-19 outbreak also mirrors the approach that IFC uses to manage the climate crisis: that businesses, investors, and financial institutions must

Businesses should redirect finances into assets and investments that deliver concrete and measurable outcomes to rebuild economies to be more sustainable and resilient.

For innovation and sustainable finance to flourish, the private sector must make the most of these opportunities.

PREPARE FOR THE NEW NORMAL From history, we learn that a global crisis creates a fundamental shift that affects consumer behaviour, government policies, and behavioural sectors for years to come.

Countries must understand which part of their social, business, and political environment will change after the COVID-19 pandemic and invest accordingly to prepare for the new normal.

lead the way to a new, more sustainable economic model.

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INVESTING IN OPTIMISM At the start of the COVID-19 crisis, stocks around the world were plummeting as people feared how the disease might impact the global economy. A few months on and millions of people are out of a job and businesses in the hardest-hit industries such as tourism and hospitality are struggling to survive. But in recent weeks, the stock market has been surprisingly positive. Could it be that investors are much more optimistic about the future than scientists?

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Investing in optimism

Wall Street stocks rose sharply in early July, as bullish sentiment in China boosted investors’ optimism in markets around the world for a recovery f rom the coronavirus pandemic. Although the market is not currently at the record highs it was in midFebruary, it isn’t too far off. The S&P 500 is hovering around where it was last autumn.

“Investors seem to have decided that the past three months were just a bad dream that we’re waking up f rom,” Scott Clemons, chief investment strategist for private banking at Brown Brothers Harriman, told the New York Times.

OPTIMISM IN CHINA

WHY INVEST NOW?

China’s yuan has strengthened to levels

Even for investors who remain sceptical of

last hit in March and Chinese financial

the optimistic recovery predictions, there

markets have rallied as confidence builds

are plenty of interesting opportunities.

that the country’s economy is well on

Favourable policies in countries around

its way to recovering from the COVID-19

the world - from lowering interest rates

pandemic.

and the discount rate, thereby increasing the weight attached to post-pandemic

As Bryce Elder, Harry Dempsey, and Daniel

earnings flows, to advantageous stimulus

Shane point out in the Financial Times,

packages - are encouraging huge

the f ront page of the state-run China

numbers of people to start investing.

Securities Journal promised investors a

It helps that technology has made the

healthy bull market and the mainland

markets more accessible than ever before.

Chinese stocks jumped accordingly. The CSI 300 index of Shanghai and Shenzhen-

WHAT’S NEXT?

listed shares rose to 5.7% on Monday the

The threat of a second wave looms large

6th of June, the biggest daily rise since

Following the Independence Day

even before much of the world has

February last year. It closed at a five-year

weekend, the S&P 500 rose 1.6% in New

recovered from the first. Nevertheless,

high, just 13% off its previous peak in June

York, despite an increase in new COVID-19

it would seem that the markets have

2015.

rebounded from the lows of early March

BEYOND WALL STREET

cases across the country and roughly 30 million newly unemployed Americans.

The market’s behaviour can be explained in large part by the actions of the Federal Reserve, which has taken unprecedented measures to pump money into the economy and stabilise the markets. Since March, the Federal Reserve has created roughly $2.9 trillion, most of which has gone into financial markets. The federal government has said it would borrow a record-breaking $3 trillion f rom April to June, to support businesses during the pandemic. Such decisive steps have reassured investors.

Meanwhile, many American first-time investors have taken the plunge during quarantine - perhaps hoping to make the most of low share prices or simply trying to alleviate their boredom. At Charles Schwab, clients opened a record 609 000 new brokerage accounts, with almost half of them created in March alone. Online trading platforms and investment apps have also helped new investors buy into the markets.

Yet political tensions between the United States and China — the world’s two largest economies — remain high, potentially disrupting the American businesses’ recovery plans.

but some investors are now content

These increases are a clear indication

to wait for more substantial proof of a

that the millions of individual

recovery in corporate earnings. If this

investors are feeling optimistic.

optimism proves to be unwarranted, a fear

The driving force in China’s equity

not just retail investors, would face huge

markets, retail investors have been

losses. But for now, many investors are

banking on the technology sector in

anticipating a V-shaped recovery and are

particular.

buying accordingly.

Elsewhere in Asia, Hong Kong’s Hang Seng index added 3.8% to enter a technical bull market, defined as a 20% rise. Japan’s Topix added 1.6% while South Korea’s Kospi rose 1.7%.

In Europe, the regional benchmark Stoxx 600 closed 1.6% higher. London’s FTSE 100 added 2.1%, with financial and mining stocks being particularly bolstered by the wave of Chinese optimism.

FIRST-TIME INVESTORS AROUND THE WORLD In what seems to be a global trend, India has also seen a large number of new retail investors entering the market directly through stock exchanges. Many of these first-time investors are young, looking to invest in their future while protecting their savings. Their arrival on the scene has increased retail participation in the stock market to new heights. Non-institutional investors have increased their share to over a decade’s high of nearly 70%.

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response could take over and everyone,

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BANNER ASSET MANAGEMENT – PUTTING THE INVESTOR FIRST BANNER ASSET MANAGEMENT – PUTTING THE INVESTOR FIRST THE MANAGER Banner Asset Management is an experienced asset and funds manager with a specialisation in debt and equity products in the Australian real estate market.

Since 2010, Banner has invested in a range of real estate and development opportunities, primarily in the larger population centres on the east coast of

Banner was started in 2010 by Andrew

This organic and gradual growth

Turner, the CEO, and a small group of

guided and continues to guide the

initial investors and chiefly invested the funds of its principals. It grew organically, to gradually wider circles of associates and their companies, family members and f riends.

The range of investors has expanded to institutions, corporates, and other funds.

All the original investors remain.

Australia.

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investment principles of ‘putting the investor first’, through responsiveness, preserving capital and earning a return.

Banner initially matched individual

It complies with strict legislative

The Banner funds have funded property

investors’ funds with individual projects

requirements, including capital reserves

projects valued at over AUD8 billion. A

though the Banner Wholesale Fixed

(net tangible assets), process and

majority of Banner’s investors are non-

Interest Income Fund. That master fund

audit requirements. The head office

residents, and it is well-versed in dealing

remains the flagship fund of the group. It

is in Melbourne, with a Sydney office,

with the needs of off-shore investors.

has added pooled funds and opportunity

principals located and active in Japan and

funds to its product offering.

Singapore. Its investors are mostly located in Singapore, Hong Kong, Japan, Europe

Banner is a registered provider of

and Australia.

financial products in the highly regulated Australian financial services and funds management sector.

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Banne r Asse t Managemen t – Putti n g th e i nvestor f i r st

THE ASSET CLASS

PRESERVING CAPITAL

INVESTMENT CRITERIA

The Australian property market has

‘Preserving capital’ refers to the role of the

Defined investment criteria is a further

seen a near uninterrupted growth story

manager in ensuring that the value of the

part of the Banner risk strategy. Banner’s

of 40 years and in this environment

underlying asset is at least maintained,

investments are located in the major

property debt, as an alternate asset, has

or improved, during the term of the

population states of New South Wales

also grown. Where a stable and strongly

investment. Preservation of capital value

and Victoria - the depth of the market

performing property market is combined

has three stages:

is important in assessing the risk on a

with a mismatch in the funding demand/

• 1. asset selection

property and its potential for sale. Loan-To-

supply equation, opportunities present themselves to both individual and institutional investors.

Value (LTV) ratios are maintained at a level • 2. rigorous processes • 3. active on-going asset management

that provides some shelter for the fund from property price risk – LTVs averaging under 65% across the portfolio.

Banner Asset Management saw the

Asset selection relies upon an experienced

market dislocation in 2009 and has offered

and capable investment committee.

Banner does not invest in the large-scale

wholesale and professional investors

It has members with property, funds

high-density city apartment blocks. It

access to the property debt. The mismatch

management, financial, investment,

favours smaller, bespoke developments in

of risk and reward has continued over

development and legal backgrounds. and

the inner suburbs with proven demand.

the past decade due to events such

representatives The Banner investment

as increased bank regulation, capital

committee considers the financial

Banner also focuses on staged, land

requirements, and government actions.

parameters of the proposal, the sponsors’

subdivisions in prime locations and

experience and commitment (including

growth corridors. All such projects have

The underlying asset (predominantly

cash commitment), the project, location,

full recourse pre-sales with cash deposits

residential property) has low volatility,

quality of consultants, asset value and

paid and held by an independent

has shown consistent growth over

proof of proven demand for the end

stakeholder.

many decades, and has low to negative

product. It is a complex process and, as

correlation with the equities market,

asset selection is crucial, Banner adopts

Banner also invests for terms of 12-24

making it a sound investment strategy

a multi-stage investment committee

months on fixed rates with multiple exit

and alternate asset.

process for each proposal, to test and

strategies. This creates a pool of assets

re-test all assumptions. No proposal is

that are frequently maturing, decreases

a ‘take it or leave it’ proposition – the

the influence of longer-term cycles, and

Australia’s development funding market

investment committee will have a number

locks in a rate of return.

has been dominated by the big four

of requirements which must be satisfied

trading banks. The banks have been

before approval will be considered.

INVESTMENT RETURNS

of the property market, it specialises

reducing exposures to the market since the global financial crisis and that trend

Process is crucial. Each potential asset

has continued since due to Basel III,

must be subject to all facets of due

increased APRA (regulatory) oversight of commercial lending and more recently the Royal Commission into the banks.

The reduced exposure of the major banks to property development has created an opportunity for private lenders to lend at good rates on secure development by very experienced developers -a very good risk and return trade-off.

Banner has nine active wholesale investor funds under management. Returns have been impressive with an average annual return to investors of circa 10% annum for its pooled funds and 10-15% per annum for its single asset funds, over the past decade. Equity, like returns, has been over 20% per annum for its opportunity funds. It also offers some direct property exposures.

Whilst Banner invests across all sectors

diligence and only through a clear and rigid process, will this be ensured.

in the residential market with some industrial and mixed-use properties and non-discretionary retails, such long-term leased supermarkets.

Banner constantly reviews this process using its lending, risk, and legal expertise.

On-going management must be active, regular and focused. For all its investments, Banner will obtain detailed monthly reports on the use of funds and progress of the construction. Banner investment portfolio managers will also personally attend all project meetings with builders, architects and developers to personally gauge and assess any issues with construction.

All of the above is a daily activity for the manager, backed up by internal risk review to ensure processes are adhered to.

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Quarterly Property Report MARCH 2020

WE INVEST IN TECHNOLOGY TO BE CLOSER TO THE NEEDS OF OUR CUSTOMERS

Through innovative technologies Arca Fondi SGR has set up new processes that have improved the relationship with customers and increased productivity and performance.

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Trave l li n g clean post-pan demi c

TRAVELLING CLEAN POST-PANDEMIC

by Sam Morgan

COVID-19 is set to have a stimulating effect

brightly-coloured ride-share e-scooters

In mid-June, the US firm said that all of

on various forms of mobility, thanks in

and e-bikes largely disappeared from

its vehicles would be electric-powered

part to a change in people’s travel habits,

Europe’s streets during lockdowns due

by 2030 to prevent tens of thousands of

caused by the pandemic. The 2020s could

mostly to curfews and hygiene concerns,

tonnes of pollution from entering the

be a golden age for bikes, scooters, electric

the sector’s big players are planning a

atmosphere.

cars and trains.

comeback.

Lockdowns and the need for social-

Uber recently offloaded its flame-red

distancing have convinced city planners to

e-bikes and e-scooters to Lime, after

allocate more space to active mobility like

leading an investment round worth $170

cycling and walking.

million. The two firms have agreed to

As quarantines lift and more people go back out into the streets, space is at a premium.

In capitals like Berlin, Brussels, Paris and Rome, kilometres of new bike paths have been created and existing routes widened. Roads that were previously the domain of cars are now blocked off and pedestrianised.

SUBSIDISING ALTERNATIVE TRANSPORT Governments want people to use mass public transport only when absolutely necessary and to leave their cars at home when possible - which was already an objective of sorts before the virus struck - and have offered purchase subsidies to thousands of people.

Italians can qualify for a €500 voucher that can be spent on bikes, scooters, monowheels or hoverboards, while French citizens can get their bike repair bills paid for by the government.

“Now more than ever, we need to work together to create cleaner, healthier, and more equitable communities,” said Lyft co-founder

integrate better their apps and collaborate

John Zimmer. “Success breeds success,

more effectively.

and if we do this right, it creates a

“Lime is emerging from the crisis as the clear market leader, with expanded bike options and financing that will position us to build a sustainable long-lasting business,” said Lime Europe’s Ghassan Haddad.

The deal suffered an immediate major hiccup though, as thousands of e-bikes were sent to the scrapheap, as Uber cited “maintenance, liability and safety concerns”. After a mass public backlash, the companies decided to reverse their decision.

CONSUMERS’ CLIMATE CONSCIENCE

path for others.”

But his company did not reveal how much it is willing to spend to make that happen and convincing the huge number of people who use their own cars to work shifts will be a tall order.

CHEAPER AND CLEANER New research shows that electric vehicles can actually be cheaper to run than regular combustion engine cars though, depending on which country drivers are in and where they are able to recharge their batteries.

According to a study by mobility group Transport & Environment, French drivers

Improved air quality caused by the slump

could save up to €3000 per year. In

in industrial and transport activity during

general, savings could reach 14% when

lockdown has also increased consumer

compared to a normal diesel motor.

awareness about health and climate issues. Uber’s ride-hailing rival Lyft has jumped on that bandwagon by pledging to go green in a big way.

Although the now ubiquitous sight of

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| 03 1

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With more and more cities announcing or contemplating diesel and petrol bans, electric cars are rapidly becoming a financially sound decision for professional and personal use alike.

A new raft of government multi-billion-euro bailouts prompted by the virus outbreak is also set to increase the choice of models available and a fall in list price, as companies like Renault and Volkswagen will have to hit ambitious production targets.

According to Bloomberg, 10% of new sales globally will be electric cars by 2024 and 28% in 2030, with much of that demand coming from China and Europe. That boost will largely be prompted by a rapid decrease in battery costs, which form the bulk of purchase prices.

Relatively new technologies aside, an old cast member of the transport scene is due for more than a cameo appearance in the coming years: train travel is due a resurgence too.

THE YEAR OF RAIL According to UBS Research, a shift in consumer habits will be a boon to Europe’s high-speed rail market, which is on track to grow 10% every year this decade. The EU even wants to declare 2021 ‘The European Year of Rail’.

Passengers are generally willing to go on longer and perhaps more expensive journeys, if there are plus points like a lower carbon footprint and an improved travel experience, opening the door for trains to eat away at cheap short-haul flights.

Rail operators are starting to cotton on to that change in behaviour by bringing nighttrains out of storage, long moth-balled due chiefly to lack of profitability and interest from rapid transit junkies.

The coronavirus may have dealt a heavy body blow to the aviation and cruise industries but for slower nodes, better suited to a postpandemic world, the outbreak may prove to be the catalyst for a major shift in how we all get around.

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Trave l li n g clean post-pan demi c

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GOLDEN VISAS AROUND THE WORLD

by Kenny Fowler

Trying to gain a traditional visa can often be quite difficult and time-consuming. Golden visas can save you a lot of time and effort, for a price.

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Golden Visas Around th e World

WHAT IS A GOLDEN VISA?

UNITED KINGDOM

EUROPEAN UNION

A golden visa is issued to individuals

The Tier 1 Investment Visa allows the

Golden visas are handled by EU member

who invest a certain amount of money

recipient to obtain temporary residency

states, but residency in an EU member

in the issuing country. The visa can be a

in the UK, for the investor and his or her

country allows one to travel across much

temporary or a permanent residency visa.

immediate family. The UK provides no

of the union without any additional

The most common means of gaining a

direct path to permanent citizenship. The

documentation. Citizenship enables one

golden visa is through the purchase of real

temporary residency lasts three years and

to work or travel within the EU, and even

estate.

four months. Applicants can apply to get

to non-EU countries which have visa-free

this residency extended an additional two

agreements with EU member countries.

The origins of golden visas go back to

years. After five years, investors can apply

Here is a sampling of some of the best

tax havens in the Pacific and Caribbean,

for indefinite leave. This can be shortened

golden visas in the EU:

which initiated investment programmes

with more investment. After six years, a

that allowed for tax advantages and

recipient can apply for British citizenship.

PORTUGAL

visa-free travel. In the early 21st century,

The Tier 1 Investment Visa requires a

Portugal has one of the best golden visa

the number of immigrant investor

minimum investment of £2 000 000.

programmes. It is the original “Golden

programmes has accelerated, with about a quarter of all countries offering these visas.

UNITED STATES

Visa” programme and is actually where Until March 2019, the UK offered the Tier

the name came from! It was launched in

1 UK Entrepreneur Visa. But at that time,

2012 to help bolster the Portuguese real

it was replaced with the Innovator Visa

estate market.

The United States grants permanent

and the Startup Visa. Unlike the previous

U.S. residency through the EB-5 visa to

entrepreneur visa, an applicant must now

A real estate investment of €350 000 is

investors of certain government-approved

provide an original business plan that

required to obtain a residency permit

projects in the U.S. This visa gives a

meets new or existing market needs. The

that allows for a spouse and dependent

recipient the right to live, work, study

applicant must also show they have the

children. You can apply for European

or retire in the U.S. Once the project is

necessary skills, knowledge and market

citizenship after five years. The visa can

complete, the recipient can receive their

experience to be able to run the business.

be renewed every two years as long as the

entire investment back. The visa allows not

applicant spends two weeks in Portugal

only for the residency of the investor but

For a startup visa, no funds are required

every two years. This visa also allows

also their spouse and any children under

to qualify. Recipients can live in the UK

travel to all 26 countries in the Schengen

the age of 21. The required investment for

with their families for two years. The sole

Borders Agreement.

obtaining an EB-5 is $900 000.

focus of the recipient during that time is developing their business. After these

SPAIN

The E2 visa is an alternative to the EB-5

two years are up, a startup visa holder can

Spain began its golden visa programme in

and can be obtained through certain

apply for an innovator visa.

2013. In order to gain residency for a family,

countries which have an E2 treaty with the

a real estate investment of

U.S. The required investment is $500 000,

The innovator visa requires a minimum

€500 000 is required. The visa can be

making it significantly cheaper than an

investment of £50 000. Recipients and

renewed every two years. An applicant

EB-5. An E2 visa can also be faster than an

their families can reside in the UK for

can apply for permanent residency after

EB-5. However, the E2 is a non-immigrant

three years. During these three years, the

five years and citizenship after ten years.

visa so in contrast with the EB-5, obtaining

recipients will be required to focus solely

There is no requirement to live in Spain

an E2 cannot lead to getting a Green Card.

on developing their business. Once the

to retain or renew the residency permit

three years are up, the applicant can apply

but applying for permanent residency or

for an extension to stay another three

citizenship requires you to have actually

years or to take up permanent residence

resided in Spain for five and ten years,

in the UK.

respectively. Like the Portuguese golden visa, with the Spanish golden visa, you can visit all 26 countries in the Schengen Borders Agreement.

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IRELAND

CONCLUSION

The Irish Immigrant Investor programme

Golden visa programmes are a way for

was launched in 2012 and then revamped

countries to increase investment by

in 2013. The update allows applicants

granting residency to foreign investors.

f rom outside the EU to gain residency in

Whether they are used simply as a

Ireland with a â‚Ź1 million investment in

way to invest and keep an eye on your

an Approved Investment Fund. Prospects

investment, a strategy for making travel

must be found of good character, have

easier or even as a means of gaining better

a clean criminal record, and they must

educational or professional options for

demonstrate a minimum net worth of

your kids, golden visas can provide a path

â‚Ź2 000 000.

to a better life.

OTHER COUNTRIES St. Kitts and Nevis have one of the oldest golden visa programmes in the world. It was created in 1984 to grant citizenship through donation or real estate investment to those applicants who qualify. The government requires an investment of $150 000 to the Sustainable Growth Fund or an investment of $400 000 in real estate. The real estate can be reduced to $200 000 for those investors with connections to the islands. These figures do not include any fees.

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Innovating th e customer experience

INNOVATING THE CUSTOMER EXPERIENCE Taipei Fubon Bank has earned the trust

Taipei Fubon Bank is rolling out a

of its customers with its customer-

Bank 3.0 digital banking environment

INNOVATION AND TECHNOLOGY DRIVING NEW TRENDS

that will use big data analysis to

To deliver a better, more convenient

develop new revenue streams and set

banking experience, Taipei Fubon Bank

oriented approach, pursuit of innovation and sophisticated service, and has championed sustainability on a foundation of financial innovation in the corporate,

up advanced information systems to

social and economic realms, earning

meet the growing demand for online

the bank considerable recognition from

and mobile banking services.

around the world.

On the institutional side, the corporate loan business grew rapidly and the syndicated loan business ranked third among privately run banks. On the retail side, a branch renovation project that localised service and product and service innovation generated solid growth in deposit, investment, insurance and credit

At the same time, the bank continues to integrate its branches and virtual channels to meet customers’ evolving financial services needs. Branches around Taiwan are being renovated to be more efficient, while internet and mobile banking services are being optimised to drive innovation in the customer experience and boost the overall quality of service.

has pioneered new “financial living� models that integrate cloud computing, big data, and artificial intelligence into daily life settings. The J card, aimed at frequent travelers to Japan and South Korea, accelerates review processes and offers a unique feature - users can increase their credit card limit with a simple tap of their smartphones, creating a great user experience.

By the end of 2019, 670 000 J cards had been issued, a new high for any single JCB credit card in Taiwan! It also moved Taipei

assets. Outstanding mortgages ranked

Fubon Bank into the top five credit card

second among privately run banks and

issuing banks with 3.29 million cards in

insurance sales ranked third among

circulation.

banking channels.

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The smart investment platform, Nano

Future Tycoon Outreach Programme

Investments, launched by the bank

to narrow the urban-rural divide and

in collaboration with Nutmeg, the UK

help disadvantaged elementary school

biggest robo-advisor, enables people

students in remote areas learn basic

to invest as little as US$ 100 in global

concepts on how to properly manage

diversified portfolios through f ractional

money.

shares technology, helping them minimise risks and earn stable returns. By the end of 2019, assets under management in the platform had reached NT$1.4 billion, and over 97% of investors had earned positive returns.

These long-term efforts have successfully planted the roots of financial literacy education in Taiwan.

Mobile payments are also ripe for innovation. The bank initiated Taiwan’s first blockchain interbank transfer sandbox experiment. The new technology simplified the transaction process and lowered costs, and may be extended in the future to cover cross-border remittances and supply chain financing. In another first, a new AI loan approval app was introduced that allows associates to check a company’s credit on the spot and calculate a precise credit line and loan rate, providing a more convenient SME loan experience.

EXPANDING OVERSEAS Taipei Fubon Bank has assertively expanded overseas to support the global development of its customers, establishing a platform that spans Taiwan, Hong Kong, China, Vietnam, Singapore, and Indonesia and offers efficient channels, innovative products and professional service. The eventual goal is to create a one-stop shop service platform that will help corporate clients go international and expand their size and network, and have them make the bank their top strategic banking partner.

GIVING BACK As Taipei Fubon Bank develops a robust financial services platform across the region, it has not forgotten the spirit of giving back through tangible actions. The Bank has held an annual Budding Tycoon Money Management Camp since 1998 to foster healthy attitudes toward money among young Taiwanese and help them understand future financial trends.

Another initiative was launched in 2012 in cooperation with the Fubon Cultural & Education Foundation called the

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MANAGING THE NEXT DECADE OF WOMEN’S WEALTH MANAGING THE NEXT DECADE OF WOMEN’S WEALTH IN CONVERSATION WITH ANNA ZAKRZEWSKI, A MANAGING DIRECTOR & PARTNER OF BOSTON CONSULTING GROUP (BCG).

Zakrzewski along with Kedra Newsom, Michael Kahlich, Maximilian Klein, Andrea Real Mattar, and Stephan Knobel, wrote the BCG report Managing the Next Decade of Women’s Wealth, published earlier this year.

Over the past few decades, women have become a sizeable economic force, but it’s these next few years that will be a defining decade for women in wealth, according to the new BCG report. Anna Zakrzewski, one of the lead authors, summarises, women are “adding $5 trillion to the wealth pool globally every year— outpacing the growth of the wealth market overall but in spite of the increasing power of their purse strings, women remain largely underserved by the wealth management community.”

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Managing the next decade of women’ s wealth

THE CONSEQUENCES OF COVID-19 While the report, Managing the Next Decade of Women’s Wealth, was published the week before the world went into lockdown, the long-term trends remain largely unaffected and women’s wealth is still expected to outpace global wealth growth over the next years. The trend is intensified by the growing number of women taking the lead in financial decisions. Some regions have more catching up to do than others. In Asia, 79% of women take the lead on financial decisions compared to 86% of men. In North America, 70% of women take the lead in financial decisions versus 92% of men; in Europe however the rate drops to only 40% of women compared to 85% men and, in the Middle East, this compares to only 20% of women and 93% of men.

As Zakrzewski explains, “over the last five months, we have seen that COVID-19 is accelerating sustainable investing. 64% of investors believe the pandemic is a tipping point for ESG.” ESG (Environmental, Social, and Governance) refers to the three central factors in measuring the sustainability and societal impact of an investment. For women, value investing is of higher importance than for men.

These past months, ESG funds have begun to further diversify beyond the red button issue of climate change. “The full breadth of the definition is filtering into mainstream investment discussions,” says Zakrzewski. If wealth managers can avoid the pitfalls of common misconceptions and “personalise their approach to meet the specific needs and priorities of individual clients, regardless of gender”, Zakrzewski argues that the enormous business opportunity of female investors can be unlocked.

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SELL

s

WHAT WOMEN WANT Naturally, how women generate their wealth varies f rom region to region. Women in North America currently hold the largest relative share of wealth, with 37% of the total regional wealth pool.

Asia, with the notable exception of Japan, is the fastest-growing hub of wealth creation for women, set to add $1 trillion per year to their total wealth over the next four years – setting Asian women up to hold more wealth assets than any other region in the world except North America by 2023. In the Middle East, women’s wealth segments in assets under management (AuM) are also poised to experience substantial growth in the years ahead with an expected CAGR of 8.8%. Female rates of primary and secondary education participation are now similar to those of

BUY

Despite these advancements, wealth managers are still using historical social norms as a reference point, regarding men as the primary financial decision-makers, and this attitude is not going unnoticed. 64% of female respondents to BCG’s survey felt that their bank or wealth management provider needed to improve its value proposition, with working women and those in the highest wealth bands expressing the most dissatisfaction. The women’s segment is too often dismissed, considered primarily in terms of marketing. Outdated assumptions about what female investors want, combined with an inadequate understanding of women’s actual behaviours and preferences, have contributed to subpar service. As Zakrzewski explains, women do think differently, just not in the way tradition dictates.

men, and women outnumber men at the university level in 15 of the 22 Arab countries.

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Managing the next decade of women’ s wealth

“There is a preconception that women

A GENERATIONAL SHIFT

ACCELERATING PROGRESS

are far more risk-averse when it

In a nutshell, “the future pool of clients,

Ten years ago, Zakrzewski was writing a

comes to investing but this simply

both men and women, will not just want

report with her colleagues on levelling

isn’t the case. It takes women longer

more, they’ll want better,” says Zakrzewski.

the playing field. At the time, it was

This means they’re looking for investments

thought that 2020 would see much less

that are engaged and purposeful. BCG’s

unconscious bias and women would

research shows that gender-based

no longer be treated as a homogenous

differences in investor behaviour diminish

group by wealth managers. Although the

with every new generation. Millennial

advancement has been slower than she

same risk profile as men. Once they

men and women share very similar views,

hoped, Zakrzewski remains optimistic

invest, it’s an equal playing field.”

including a shared preference for purpose-

that the speed of change is only going to

driven investing.

accelerate and is hopeful that we will see

If you dig a little deeper into women’s

Meanwhile, more women than ever are

typical investment behaviour, they tend

taking the lead in financial decisions - 70%

to spread their risk a bit more but remain

of millennial women, compared with just

more committed than men when it

40% of female baby boomers. Zakrzewski

comes to long-term investments, having

explains that “women’s empowerment

the patience to make investments

is fuelled by three main drivers - wage

with a longer-term perspective. If the

equality, more entrepreneurial activities

performance of two investments is more

by women, and more women in leadership

or less on par, women tend to choose

positions. Women that accumulate wealth

ESG-focused investments more than men;

themselves tend to manage it more

and also those that most align with their

actively. Our data shows that younger

own values. In addition, they are looking to

women delegate fewer financial decisions

invest to fund specific life stages or goals

than older women.”

much more than men.

to make an investment decision because they tend to gather data and information before committing. But when they do take the plunge, it’s the

the industry taking big strides in the next

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five years.

BOOSTING THE ISLAMIC FINANCE SECTOR WITH BLOCKCHAIN Sharia law prohibits banks from charging

f rom these late-payment charges, they are

for the technology to automate the

interest on loans to their borrowers.

not incentivised to collect these fees and

execution of Shariah contracts and

Islamic banks offer financing to individuals

distribute them to charitable organisations

minimise the risk of procedural errors. It

and businesses through real economic

in a timely manner. Meanwhile, the

could also improve the traceability and

transactions such as joint ventures,

debtors see these late fees as an act

transparency of certain funds in complex

deferred sale, and leasing agreements.

of charity, meaning that their sense of

humanitarian settings.

To offer credit financing, Islamic banks

urgency to pay their debt obligations on

need a mechanism to discipline debtors to

time might diminish.

Although the technology is still a

pay on time. A common practice involves

controversial topic in Islamic finance, both

charging debtors with late fees, which

Blockchain originally impacted Islamic

the Middle East and Southeast Asia are

are then donated to charity. However,

finance through optimisations like

home to a growing number of Islamic

because Islamic banks are not allowed to

blockchain-based Halal certification

fintechs.

incur any profit and in turn any benefit

schemes but there’s a growing demand

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A DIGITAL PIONEER

IMPLEMENTING BLOCKCHAIN IN CREDIT FINANCING

The partnership aims to leverage the

Islamic financial institution, was the first

The Islamic Research and Training

deploying blockchain systems to further

Islamic bank to successfully execute trade

Institute (IRTI) of the Islamic Development

the IsDB’s mission of enabling greater

finance distribution transactions using

Bank (IsDB) Group has partnered with

financial inclusion, alleviating poverty,

blockchain technology.

the blockchain technology firm Blocko

and accelerating the development of the

The cross-border transactions, which

to build a blockchain-based innovative

Islamic financial industry.

were completed with multiple banks,

credit enhancement system. It would

were made possible through ADIB’s

minimise the risks associated with credit

Phil Zamani, CEO of E24P, said, “the

partnership with TradeAssets, a trade

financing to businesses and consumers

implementation of blockchain systems

finance e-marketplace powered by

by using new economic incentive models

in complex processes like credit and

blockchain to help digitise the traditional

and advanced implementations of hybrid

insurance has long been sought after by

processes of origination and distribution

blockchain technology.

financial institutions around the world.

Abu Dhabi Islamic Bank (ADIB), a leading

Forward-thinking Gulf Cooperation

of trade assets. For the past year, ADIB’s collaboration with TradeAssets has

“The Islamic finance market is

enabled it to automate trade finance

growing rapidly, with projections

transactions and conclude transactions successfully with banking counterparts in emerging markets.

E24P blockchain teams’ deep expertise in

of a rise from around $2 trillion to an impressive $3.78 trillion by 2022. Yet certain technical and economic challenges have prevented the industry from truly flourishing,” said Dr Sami Al-Suwailem, Acting Director-General of IRTI.

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Council (GCC) countries, such as the UAE and Saudi Arabia, have been especially progressive, implementing blockchain projects to accelerate their digital transformation agendas and smart city innovation strategies.”

The new system being developed by IRTI

The system allows creditors to reduce the

“Fintech could stimulate growth by

and implemented jointly by IRTI and

credit default rate to improve their overall

making transactions quicker, more secure,

E24P uses a novel incentive mechanism

business performance and accelerate

and easier to implement. And we believe

that encourages early repayment and

efforts in areas of financial inclusion.

the social role of Islamic finance could

contributes fees to an insurance pool

unlock new growth opportunities as core

that covers involuntary credit defaults.

ACCELERATING GROWTH

markets implement the UN Sustainable

Such a system would not be feasible

According to a recent S&P report, the

Development Goals, and issuers and

through conventional arrangements but

global Islamic finance industry will

investors become more sensitive to

is facilitated through the use of high-

continue to expand slowly in 2019-

environmental, social and governance

performance blockchain technology. Once

2020 but fintech and blockchain could

(ESG) issues,� said S&P Global Ratings head

completed, the system will be of great

significantly accelerate the growth. The

of Islamic Finance, Mohamed Damak.

value to Islamic banks and other financial

COVID-19 pandemic has also shown the

institutions.

importance of leveraging technology and creating a nimbler industry. With

With this system, Islamic banks, and

the right coordination between different

indeed other financial institutions, can

Islamic finance stakeholders, the report

ensure that credit assessments are performed in a provably transparent and responsible manner while keeping

argues that the industry could create new avenues of sustainable growth that serve the markets.

the data and methodology used appropriately secure and confidential.

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WHAT’S UP WITH SWISS PRIVATE BANKS?

by Jan Langlo, director of the Association of Swiss Private Banks As Albert Einstein said, “in the midst of every crisis, lies great opportunity”. This is mostly due to being forced to do things differently. In the wake of the recent pandemic, many rules were introduced or changed. How did this impact Swiss private banks?

Let’s look at this from the point of view of employees, clients and regulatory authorities.

Nearly overnight, about 80% of bank employees were forced to work remotely. Business continuity plans were put to the test and proved the resilience of the banking system.

An evolution which would have taken years happened in a few weeks. Banks which were cautiously introducing home office now have, at most, 50% of their staff in their premises.

Split teams are still the norm and this helps reduce the number of people who use public transportation. The good news is that most employees who work from home enjoy it and are as productive as before, some even more. Nevertheless, contacts in the office are still necessary for an optimal sharing of information and spreading of the company’s values.

Banks were not closed during the lockdown, as their activities are always essential. Payments still need to be made, even if some mandatory ones like taxes or insurance premiums were postponed. Credits were crucial to maintain liquidity and in a single week, commercial banks, government and the Swiss National Bank set up a plan to grant loans that are interest-free up to 500 000 Swiss francs and guaranteed by the Swiss State to small and medium enterprises, to compensate up to 10% of their annual revenues. This scheme allowed a quick distribution of more than 14 billion Swiss francs. The employees of commercial banks did a fantastic job and did not count their hours to handle the more than 130 000 credit requests that came in.

On the wealth management side, there was also a lot of activity during March, as clients wanted to reallocate their assets as the markets crashed. Although physical contact had to be avoided, human interaction remained at the heart of investment activity.

Clients understood that their banker could no longer travel to meet them and adapted quite well to videoconferences. Many accounts were opened online, new applications were launched and contactless payments soared (and the limit under which no PIN entry is required was raised from 40 to 80 Swiss francs).

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Regulatory authorities also showed a lot of flexibility in light of the constraints that banks faced. For instance, they agreed to extend the deadline to obtain certified copies of passports or other documents when opening an account f rom abroad.

They relaxed the capital and liquidity requirements linked to the credits mentioned above. They added some exemptions relating to the leverage ratio

• Banks accelerate the development of workflows without media discontinuity • Demand for financial products and services via digital channels rise quickly • Diversity and complexity of payment transactions increase • Trend towards smart working solutions intensifies

and risk diversification. All this shows the value and efficiency of the Swiss financial centre, where banks and authorities discuss and find practical solutions.

Going forward, the pandemic showed

a stable power-grid and sustainable power stations. Huge investments in infrastructure need to be made, to prepare for a clean and healthy society. And let’s not forget security, as nothing will eliminate the fact that some also see an opportunity for ill-gotten gains whenever a new system is put in place. Amidst all these changes, private banks are there to help their clients identify the winners of tomorrow.

• Investments in high-quality and secure digital infrastructures grow • Authorities speed up end-to-end e-capability

that the economy will need to rely

Switzerland will also soon be voting on

more and more on digital solutions.

the introduction of an electronic identity,

Must we all really commute to work

supervised by the state, but implemented

every day? Do we need to go to stores

by private companies. As cloud solutions

to buy something? Most production

become more and more common,

and leisure activities require a physical

larger quantities of data will need to be

presence, but distribution only requires

exchanged, also on mobile devices. Swiss

drivers (or drones), and services can be

telecommunication operators are already

rendered online. In the field of finance,

developing their 5G network. All this will

SwissBanking sees six digital trends:

require a lot of energy, which implies

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Collaboration for innovation

COLLABORATION FOR INNOVATION THE COMPANY

THE FUNDS

Arca Fondi SGR is an Italian active asset

Innovation has been at the heart of

management company, founded in 1983

Arca Fondi’s business model since its

by the association of 12 cooperative banks.

beginning. After the introduction of the

Today, Arca Fondi manages around €32

law that established mutual funds in

billion divided between mutual funds,

Italy (Law 77/1983), Arca was among the

The innovation, however, is not limited to

pension funds, and institutional accounts.

first asset managers to be created in the

financial products, but also in creating

Thanks to a network of distributors made

country. The first two funds, Arca RR and

new services for its partners. Arca Fondi

up of more than 100 banks and other

Arca BB, were launched a year later in

has generated a digital ecosystem that

financial institutions scattered throughout

1984. Even today, these two funds are real

can support and guide its distributors and

the country, its client base is made up of

blockbusters, with an impeccable track

customers.

over 800 000 investors. With almost forty

record and a more than sevenfold increase

years of experience, Arca has established

in the net asset value. In 1998, the pension

The website, Arcaonline.it, has recently

itself as one of the country’s main asset

fund, Arca Previdenza, landed. In addition

undergone an important redesign to

managers.

to being one of the first open pension

improve the user experience through any

funds in Italy, today it is also the largest in

device. On the website, the partners can

the country.

find all the relevant information required

THE PEOPLE

step that led to the creation of a range of ESG funds and an innovative proprietary ESG Rating system.

THE SERVICES

to support operations. In addition, there

The strength of Arca Fondi is its people.

Teams who continuously improve

In 2015, Sidera Funds Sicav was created, a

is a section dedicated to all the Arca

themselves to achieve corporate goals.

Luxembourg-based platform dedicated

Fondi products that can be viewed by

The corporate culture nurtures talent in

to private and affluent customers. Two

anyone and provides information on the

an environment that encourages self-

years later, the PIR funds (Piani Individuali

performance and composition of the

improvement and striving for excellence.

di Rispamio), a segment dedicated to

funds and much more.

Thanks to numerous innovative processes

investments in the Italian “real economy”,

implemented in recent years, the

made their debut. In a short time, Arca

The site is also an archive of all Arca’s

customer has been placed at the centre of

also conquered leading positions in this

commercial and multimedia production.

every single activity. The professionalism

market.

You can find videos that comment on the performance of the markets or

and creativity of all employees make Arca Fondi the ideal partner for the investor

Finally, in 2019 Arca signed the United

sectors, but also exclusive and always

looking for reliability and safety.

Nations Principles for Responsible

updated reports. These materials are

Investment (UNPRI), an important first

shared through dedicated newsletters

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and using Arca’s social media channels which cover a series of initiatives as well as being a tool for advertising campaigns, often in collaboration with partner banks.

Moreover, Arca has recently launched a financial education project entitled 3 minutes with Arca, a blog that aims to help readers easily understand the risks and opportunities of the markets.

ArcaClick is the area dedicated to all customers who own Arca funds. With the latest facial recognition technologies, the registration process has recently been improved. The procedure can be carried out independently with a personal device or at the bank. ArcaClick allows the customer to have their portfolio, documents and all their practices under control. Those who join the pension fund can also quickly pay their contributions online if they wish. ArcaClick is also accessible f rom the Arca Fondi App, a f ree and constantly updated application available on both iOS and Android. The app is an important tool especially for the growing centrality of smartphones in all of our lives. Customers can always have their portfolio under control or read the latest

THE LAB

InnovAction Lab is a division that makes colleagues’ collaboration the central part

In 2019, Arca created a new internal division called InnovAction Lab to further grow in the Italian market while facing

of its work. Everyone works side by side to bring different experiences to reach the most efficient conclusion. One of the main

up to the challenges of the future.

focuses is sustainability. For example, the

InnovAction Lab focuses on improving processes using the latest technologies, data analysis and by making the customer the centre of attention. Over the past year, several projects have been put in place

rethinking of many processes has led to better integration and, above all, has been able to reduce paper consumption.

Today, many of these solutions have

to improve relations with partners and

become realities that can be appreciated

customers.

by both Arca Fondi’s customers and distribution partners. But this is only

An internal data warehouse has been created which represents the real brain of all commercial and analysis operations.

To make the most of its potential, it’s been integrated with a latest-generation

the beginning. Thanks to talent and technology, Arca’s ecosystem is constantly evolving to guarantee the most efficient and safe experience.

CRM, adapted to the needs of an asset manager. To support commercial partners, new innovative solutions have been created such as a Smart Advisor to help distributors sell the most suitable products for customers. Recently a ChatBot, called Sara, has been developed to help anyone in the search for information on the Arca world through the website, WhatsApp or Telegram.

news, discover the fund manager’s videos and much more.

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Co mb ining pub l ic an d pr ivate i nvestmen t i n n et-zer o

COMBINING PUBLIC AND PRIVATE INVESTMENT IN NET-ZERO

by Alex Kazaglis, Director of Vivid Economics

ONE YEAR AGO, THE UK BECAME THE FIRST MAJOR ECONOMY TO PASS NET-ZERO EMISSIONS INTO LAW.

To be a basis for growth in the longer

Since our work has been published, this

term however, jobs must be in areas

is a priority that has been reiterated by

where there are displaced workers. In

several reports, including the Energy and

the UK context, this means investment

Climate Intelligence Unit in the UK and

In recent days, however, the Government’s

opportunities that can boost the

the IEA globally.

statutory advisors, the Committee on

economic recovery of underperforming

Climate Change, have reported that

regions, such as by creating decent green

2. Investment in nature and biodiversity

government actions fall well short of what

jobs in those areas.

is a vital part of the UK recovery, including investing in rural employment and

is required to meet net-zero. A green stimulus package could help fill that gap

Many jobs are better suited to existing

adapting to adverse climate effects and

and deliver an internationally credible net-

market mechanisms and private-sector

impacts. This includes projects that lead

zero plan (vital in the context of hosting

delivery, rather than a stimulus effort.

to carbon sequestration and biodiversity, as well as flood management which

the COP26 conference in 2021) as well as generating economic activity (at a time

There are low-carbon sectors where

contributes to rural sectors. Our research

of recession and economic dislocation). A

private investment can deliver the levels

shows that investments in parks will

green stimulus could also help rebalance

of deployment required. For example, low-

reduce health costs, reduce air pollution,

pre-existing regional inequities, through

cost onshore wind can proceed through

and improve many other aspects of urban

investment in areas of the UK where there

the market. Industrial energy efficiency

life.

is underemployment.

can also proceed through the market but only if regulations are enhanced.

Vivid Economics’ recent work, A UK Investment Strategy: Building back a resilient and sustainable economy, set out priority areas for investment that also

Taking these factors into account, our report identified £30 billion annual

deliver against the net-zero agenda.

net-zero investments (combining

Key areas for investment are those that

generate economic activity before

support employment and economic

2030.

activity. While there are already over 460 000 UK jobs in low-carbon businesses

public and private) that would help

The five priority areas that emerged are:

and their supply chains, a further 200 000 jobs that could be supported

1. Investment in green buildings can

in the next 10 years. But not all jobs are

support the most jobs in the short run and

the same – the timeline and location of

provides societal and resilience benefits.

jobs are important. Over the short term,

The green building sector has a total

it is important that jobs boost overall

annual investment need of £12 billion and

economic activity. Fortunately for many

this will support at least 85 000 direct

large inf rastructure projects, jobs and

jobs in green retrofitting by 2030. For

economic activity are generated during

energy efficiency building retrofits, there

the construction phase.

is a skill overlap with current construction jobs, but low-carbon heating requires maintenance and installation engineers to upskill f rom gas boilers to heat pumps.

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3. Investing in clean energy

5. The UK automotive sector already

infrastructure, especially in offshore

supports over 100 000 jobs and low-

wind and electricity grids, can support

carbon investment in electric vehicles

green jobs. 28 000 jobs, including in

(EVs) and EV infrastructure could help

manufacturing could be supported in

support further growth. Currently, the

TO PAY FOR THESE INVESTMENTS, MAJOR, WELL-DESIGNED NEW POLICY INITIATIVES ARE NEEDED TO RAISE THE REQUIRED PUBLIC FUNDS.

raising the UK’s offshore wind capacity

sector is characterised by job substitution,

While the recently announced UK ETS is

f rom 8.5 GW to 40 GW. The sector is

where workers with skills to produce

a good starting point, it is unlikely to raise

already market-driven, but current

petrol/diesel vehicles can transfer these

sufficient revenue in the short term unless

contracts for difference (CfDs) can be

to EV assembly, supporting around

a high price floor is implemented. Other

widened. Government can play a key

11 000 jobs by 2030. New jobs can be

mechanisms, such as carbon obligations,

role in redistributing the co-benefits,

supported in complementary sectors:

could be used to shift costs onto the

by strategically choosing production

batteries and charging infrastructure,

private sector. Ultimately a balance of

locations in underdeveloped regions.

with an investment need of over £1

these tools will be required to raise funds

To support these larger power sectors,

billion annually, can support around

in the short term and yield the more than

investment in transmission and

5500 jobs, and these sub-sectors are

£90 billion of net annual benefits to the

distribution is also required, which has

especially interesting for creating a

UK.

its own capacity to support jobs and

competitive advantage internationally.

economic activity. Investing in over-

Additionally, creating a viable battery and

capacity of electricity grids is a smart

charging infrastructure sector will have

strategy for future grid development.

a positive spill over on EV producers to boost production, without having to use

4. Carbon Capture and Storage has the

subsidies or other incentives.

potential of supporting around 30 000 jobs. A net-zero pathway includes approximately 3 million metric tonnes of industrial CO2 captured per annum and will also require some form of carbon removal technology such as bioenergy with CCS (BECCS) or Direct Air Capture (DAC). Investment for industrial carbon capture alone will require around £400 million annually for both the capture units and the supporting transmission and storage inf rastructure.

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MANAGING MASTERPIECES: THE FUTURE OF ART COLLECTION MANAGEMENT From the city of Porrentruy, in the Swiss Jura, Herculis Partners

In an ever-changing global economy, art is now more accessible

(wealth management) and Herculis Guardians SA (storing

to a new public, through new channels. Art and finance are now

precious goods and renting individual safes) have a front-row seat

considered two fingers of the same hand – the union of culture

to the increasingly fierce competition in the wealth management

and wealth. So Herculis Group has gathered the right personnel,

sector and alternative investments. In particular, Herculis

developed its employees’ expertise, and built a high-security area

managers have seen the global art market fluctuate in the wake

to store, exchange or simply to share these valuable items.

of the financial crisis.

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Managing Masterpieces: Th e F uture of Art Collection Management

As in finance, transparency, regulation, and technological trends play an important role in the art market’s future. Therefore, a collaborative approach between all stakeholders (art professionals, collectors - young and old - and asset managers) is essential to respond to the pressing issues and challenges in the years to come.

COLLECTING ART IS AN ART BY ITSELF Today’s art market is full of forgeries and the forecast is grim. But people are making a more proactive effort to mitigate the risk. It is a challenge for gallerists, experts and other industry players. At Herculis Guardians, we have seen a significant change in the choices made by collectors. New collectors - young and from emerging regions - tend to use the services of others to help them with purchases. While most collectors tend to buy what they like, others acquire it as an asset class. And many are doing both.

Nikolay Karpenko head of Herculis Guardians SA underlines, “our clients expect nothing less than perfection and know that they can count on us for unparalleled security and confidentiality to protect their most precious assets”.

The general public believes investing in art is usually a high-risk, illiquid, opaque, unregulated investment, with high transaction costs, at the mercy of erratic public tastes and short-term trends.

This misconception may be enough to dissuade many people f rom taking an interest in the art markets and related investments.

The 2008 crisis stimulated the emergence of new compliance policies and new collective investment vehicles dedicated to art or other collectables around the world as well.

RESPONSIBLE ART There are a number of trends pointing to better transparency, from authorities’ increasingly strict requirements to much more accessible data. Actually, on the f ringes of the Geneva Art Fair, the Responsible Art Market (RAM) collective has been bringing together lawyers, experts, gallery owners and auction houses for the past four years.

The RAM collective initiated a series of

This technology has been given a boost by the current health crisis and the cascading cancellations of fairs and other major art events. Like museums, actors have turned to online exhibitions and exchanges. This is a fundamental trend to emerge from the pandemic that will undoubtedly continue, just like teleworking or videoconferencing.

ART AS A NEW ASSET CLASS

recommendations aimed at drawing the

New financial vehicles make art an asset

attention of collectors and gallery owners

class by itself. Of course, the relationship

to the legal threats they face. For instance,

between art and finance has existed

any art piece sold for more than €10 000

for centuries, but today we are seeing

must submit to the new anti-money

a development of art services among

laundering directive that came into force

financial institutions and small asset

in early January across Europe. Gone are

management boutiques such as Herculis.

the days when a client could fall for a painting at the FIAC in Paris, buy it on the

From an investment point of view, art

spot and walk away with it!

is taking advantage of its attraction

To some extent, technology, whether that’s the internet or the more recent example of blockchain, is now helping to alleviate these issues of transparency, traceability and accessibility.

Technological evolution strongly supports art as an asset class, while also making it more accessible.

for diversification, especially in a period of low - or even negative interest rates in developed countries.

Advice and risk analyses offered by the asset management companies are increasingly accessible to investors who wish to build up a collection of works of art. Although art items do not usually generate cash flow and are also virtually “unhedged”, we have seen the emergence

We are witnessing a democratisation of

of financial products linked to the art

this field. While some living artists can sell

domain.

their works at auction for more than $10 million, 68% of the lots sold in 2018 went for less than $5000.

Blockchain has opened and decentralised the market. All network participants can see the artwork and all relevant information. Should they want to, they can go on to make direct contact with the seller, reducing the need for intermediaries. Thanks to blockchain and the internet, artists do not need galleries to present their work and attract buyers.

With the emergence of new business

THE ADDED VALUE OF COLLECTION MANAGEMENT. One might wonder whether art might not be ready for a transformation similar to what happened in real estate 40 years ago. Real estate today is a widely accepted investment class, accessible to many, and is generally included in portfolios for diversification purposes. Investing in young and little-known artists is very similar to venture capital financing.

We can distinguish three categories of artrelated services: art advisory services, art

models such as online auctions, for

secured lending, art investment services.

artists creating and selling in the

Herculis Group supports its customers in

digital space, the possibilities seem endless.

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all these categories.

At Herculis Guardians, we offer a safe storage solution in a high-security environment with specially equipped vaults while making the collector’s life easier with a secure dedicated showroom.

Here, the collector might simply enjoy the work to the fullest or arrange for appraisal and commercial operations without making the paintings travel, saving both money and reducing risk - most accidental damage to artwork occurs during transport.

“It looks more like a museum of contemporary art than a warehouse,” says Claude Gaudin, Director.

We can store precious good in our EDO-FREEPORT warehouse, allowing the postponement of VAT, while waiting for the goods to be delivered to end customers anywhere in the world.

Customers benefit f rom lower insurance premiums, tax-free storage space and easy access to the nearest airport.

POST-PANDEMIC Naturally, COVID-19 is weighing on the market, particularly in Asia, a region that has certainly been key to the growth in demand for art in recent years and it will probably urge the fair organisers to review their models.

Our concluding suggestion to a potential art buyer: at this stage of the cycle, selectivity is paramount. But most importantly: follow your instincts and buy works of art that speak to you. Beyond purely speculative considerations, they could stay in your possession longer than you think!

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Managing Masterpieces: Th e F uture of Art Collection Management

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BREITLING’S DIGITAL PASSPORT In a global first, the Swiss luxury watch brand, Breitling, is accelerating its blockchain-based innovation with the release of a limited-edition watch, featuring a blockchain-based digital passport powered by Arianee to prove authenticity and ownership.

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TOP TIME For now, the digital passport is exclusively available to Top Time owners and will enhance Breitling’s already best-in-class e-warranty programme by linking the guarantee directly to the watch and empowering clients to engage with the brand as they wish.

The 1965 classic gets a modern twist as the new limited edition series is Breitling’s first watch offered with a blockchain-based digital passport attached that confirms the authenticity and ownership of the watch throughout its lifetime.

The protocol developed by Arianee gives a digital, inalterable, and augmented identity to each product; like any blockchain-based network, it is entirely secured and private.

Breitling is the first watchmaker worldwide to propose a warranty programme enabled by blockchain.

Each Top Time owner will benefit f rom a private and unique digital passport securely linked to his or her limitededition watch. By scanning the validated e-warranty card, they can access and download an encrypted private wallet where the passport is securely stored.

With such blockchain-based digital

Antonio Carriero, Breitling’s Global CDTO

passport, collectors no longer need to

said, “with Arianee and its blockchain

keep paper records and can engage with the brand as much as they wish,

The passport includes all the details about

under full anonymity.

the watch, including its serial number, and

technology, we have the unique opportunity to strengthen the link with our customers. This is only the beginning, but we are already working on innovative ideas on how to further leverage Arianee

is stamped with an event representing the date of the warranty activation on

COLLABORATION FOR INNOVATION

the purchase date. Only accessible by the

Breitling’s ambitions don’t end with

owner through the wallet, this passport

the digital passport. As a sign of their

includes a transfer feature that enables

commitment to developing blockchain’s

the owner to prove the authenticity of the

potential for the industry, Breitling has

watch, and his or her legal ownership.

become an active participant within the Arianee consortium.

This innovative service will offer an additional layer of value for Breitling Top Time owners by eliminating the need for a physical authenticity certificate.

Additionally, it will enable the transfer of the warranty.

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to bring additional services to our customers”.

Arianee were pleased to welcome Breitling into the consortium. Co-founder, Emmanuelle Collet, added that “this project is a great illustration of how our open-source protocol can add a layer of value to existing innovative programmes.

Our open-source protocol is specifically built to make it easy to create and manage digital identities to ultimately add more value to brands and clients”.

A DIGITAL FUTURE As Carriero explains, “at Breitling, customer engagement is at the heart of everything we do. Technology empowers customers and digital is how they live. It is on us to change and to keep the pace with the speed society is moving”.

Keeping up with customers’ expectations of what products can and should be able to deliver means Breitling will be one of many investing more in digital technologies to revolutionise the luxury good market.

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Towards a Sustainable Future: Over a D ecade of Sustainability

TOWARDS A SUSTAINABLE FUTURE: OVER A DECADE OF SUSTAINABILITY TOWARDS A SUSTAINABLE FUTURE: OVER A DECADE OF SUSTAINABILITY A sustainable business involves long-term, strategic planning for business growth with positive environmental, economic and societal continuity. It is about ensuring the prolonged existence of an organisation in a way that benefits the business, its stakeholders, and the environment. Organisations need to understand the impact of sustainable development on their longterm survival and the importance of its leaders’ commitment.

The triple bottom line of People, Planet, and Profit captures the essence of sustainability by measuring the impact of an organisation’s activities on profitability, shareholder values as well as its social, human and environmental capital. People and organisations today are constantly working towards balancing their triple bottom line.

The sustainability sector has grown rapidly, with global annual revenues at about $1 billion and projected revenue of over $12 trillion by 2030. The success or failure of sustainability goals must be measured in terms of the wellbeing of people and the health of our planet, and not only in terms of profit and loss.

At Access Bank, one of Af rica’s leading financial institutions, we are committed to contributing significantly, towards the achievement of the Sustainable Development Goals (SDGs).

We are aware that our operations have a direct impact on the economy, people, and the environment. Therefore, we always ensure that our business operations and practices are environmentally responsible and socially relevant. Part of our contributions to the SDGs is also facilitating and financing sustainable economic growth as well as increasing our efficiencies to mitigate adverse environmental impact.

Over a decade into our sustainability journey, we have

PEOPLE We strengthen the people and businesses in our local communities by supporting various projects, organisations, and events that are focused on making a positive difference. Our priority areas of support include health, education, sports, arts, social welfare, and environment.

We have invested over N9.34 billion in various corporate social responsibility efforts since 2015, impacting more than 1316 communities and touching 30 075 356 lives and 793 NGOs. Some of our notable community investment programs include the 2020 HIV Testing and Counselling Services at the Access Bank Lagos City Marathon. At the event, we tested and counselled 3235 people. We also reached 33 468 people with HIV educational materials and distributed 10 000 condoms. In July 2020, amidst the COVID-19 pandemic, Access Bank partnered with 9iJaKids to deliver an online financial literacy and educational gamification modules to children. More than 2000 children were able to access financial literacy education through the programme.

In 2019, the bank partnered with ACT Foundation to provide grants to 28 NGOs to implement projects in the areas of health, entrepreneurship, environment and leadership. The grantees have so far impacted over 685 505 lives through their programmes.

The bank partnered with SME FUNDS, to develop the Green Social Entrepreneurship Program (GSEP), a social enterprise focused on ending poverty by promoting sustainable enterprise development. The program empowered entrepreneurs with clean cooking stove technology, which makes use of Bio-Gels made from water hyacinth, biocremol, caustic soda, fragrance and chlorophyll, to replace existing cooking technologies that are harmful to both human health and the environment.

aligned our corporate philosophy with our sustainability strategy and remain committed to setting standards for sustainable business practices.

We provide innovative solutions and implement strategic initiatives for our shared future, as we pursue our vision to become the world’s most respected Af rican bank.

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Thanks to this programme, 598 households now use clean stove technology across Nigeria while 2100 people use clean stove technology, displacing 292 metric tonnes of CO2.

In addition to Access Bank’s community investment efforts, its

In 2018, we launched the Africa’s Gateway to the World campaign,

employees advance sustainable social development in their

a strategic initiative which promotes global access to finance

communities through the Employee Volunteering Scheme.

in Africa, thereby increasing economic opportunities and

Employees contribute ideas, skills, and resources to address social

investments to further boost national savings.

issues while gaining hands-on experience and fulfilment.

Our Access Africa product is an instant fund transfer product Between 2015 and 2019, employees devoted 2 735 011 hours in over

designed to simplify global payments by Person-to-Person (P2P),

320 strategic initiatives across six geo-political zones in Nigeria!

Business-to-Business (B2B), Person to Business (P2B), Government

Volunteering is embedded in the performance appraisals of all

to Person (G2P) and any other payment activities/flows. Access

staff, thereby encouraging active participation.

Bank has leveraged its extensive partner network to extend the reach of Access Africa to about 15 countries which include the UK,

PLANET

France, Germany, China, and Benin. Within the year, transaction

Access Bank’s culture recognises that a better and prosperous

value stood over $41 million in approximately 14 000 transactions.

future is linked to the well-being and health of our planet. The bank invests in innovative technologies and techniques that promote the efficient use of resources and address sustainability issues when managing risk.

Access Bank’s dedication to a cleaner environment is evident from its investment in alternative energy sources. Alternative sources of energy will power the future and Access Bank continuously seizes opportunities to harness energy derived f rom environmentally conscious means. The bank currently has 58 branches powered by alternative energy (hybrid); 559 solar-powered ATMs nationwide; LED lightings and motion-sensitive lightings in the Head Office and some branch locations. It recycles its waste across 75 business locations, there are water-efficient taps at its Head Office. It also ensures regular reporting, monitoring, and evaluation of electricity consumption across all branches.

The bank has an early shut-down policy which ensures that staff members shut down systems at 7 p.m. These efforts have contributed towards reducing our carbon emissions as we recorded a 33.6% decrease in our electricity consumption at our Head Office and 31% decrease nationwide in 2019.

Our ‘No-Paper’ initiative focuses on saving trees to help protect the environment. We have automated our business processes with the launch of the ERP Dynamics 365 and ProcessMaker applications. This year, the bank launched the Paper to Pencil recycling initiative, converting old branded paper items of Access Bank to pencils.

PROFIT Access Bank’s goal is to facilitate and finance sustainable economic growth, leading the way on sustainable finance, financial inclusion, helping develop enterprises and championing sustainability regulation and thought leadership. This is done through our strategic partnerships and collaboration with formidable institutions, to address responsible business needs as well as provide solutions that help improve communities.

In 2019, Access Bank launched the first-ever N15 billion Corporate Green Bonds, certified by the Climate Bonds Initiatives (CBI).

The Bond was listed on the FMDQ platform, the Nigerian Stock Exchange, and the Luxemburg Stock Exchange. The proceeds f rom the bonds financed environmentally f riendly projects.

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Towards a Sustainable Future: Over a D ecade of Sustainability

THOUGHT LEADERSHIP

RECOGNITION

Access Bank has continued to comply with environmental and

Over the years, Access Bank has gained recognition and

social laws as one of Af rica’s foremost banks in sustainability. In

remained a pioneer among its peers mainly due to its strategic

2019, the bank served as the regional lead in drafting the Global

collaborations and efforts in promoting sustainable development

Principles for Responsible Banking in collaboration with UNEP

both in Africa and globally. As a result, the bank received

FI. The princinples serve as a global framework for financial

numerous awards from prestigious awarding bodies, both locally

institutions to comply with a set standard for interacting with the

and internationally.

environment.

Access Bank continues to set the pace for sustainable finance The bank also serves on the board of several leading local and

in Nigeria and Africa by delivering value-adding products

global organisations, including:

and services, improving the economic and social status of

• Co-Chair, Corporate Alliance on Malaria in Africa

our communities. Our commitment to sound sustainability practices means we constantly monitor the socio-economic and

• Co-Chair, Nigeria Business Coalition Against AIDS • Chair, Nigerian Sustainable Banking Principles Steering Committee • Member, Private Sector Delegation to the Global Fund Board • Board Member, United Nations Global Compact Local Network Nigeria • Af rica Consultative lead, Global Principles for Responsible Banking • Member, United Nations Environment Programme Finance Initiative • Member, Equator Principles • Gold Member, Global Reporting Initiative • Member, International Council for Sustainable Standards and Certification Initiative

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environmental impact of the activities of all our stakeholders and remain at the vanguard of sustainability regulation and thought leadership.

THE SPREAD OF ISLAMIC FINANCE OUTSIDE THE MIDDLE EAST

by Aykut Alan

• Ijara (Islamic leasing): These are

Islamic banks have been integrated

finance tools are used in about 60

into the world financial and banking

countries. The Islamic financial market

operational or financial leasing

system in the last 20 years, although the

accounts for 1% of the global financial

contracts similar to leasing. The bank

banking system in Islam is much older.

system, estimated at roughly $2.5 trillion,

buys assets on behalf of its customer

However, Islamic banking and financial

covering some 1400 institutions spread

and makes it available to third parties

instruments offer a limited service to

across 80 countries.

with a fixed lease. The property is owned by the bank but shares the

investors compared to the banking Islamic financing is not to use interest or

THE MAIN STRUCTURES OF ISLAMIC FINANCE

“riba” in the words of those who manage

The basis of Islamic finance is the

these banks in any financial investment or

prohibition of interest. There is no problem

banking transactions.

in terms of profit from an investment. The

practices we know. The basic principle of

basic principle is not to make money from The concept of Islamic finance, defined as

money, but to make money by turning

“interest-f ree banking” or “participation

your money into an investment, but in this

banking” in the economic literature,

case, there is a possibility of loss. The main

requires that financial transactions and

structures used in the Islamic financial

banking operations be carried out in

market are:

not applied when borrowing or lending.

It is also prohibited to use financial instruments open to speculation in the Islamic financial market. Today, Islamic

• Mudaraba (instalment sales): It is a partnership in which the bank provides capital and the other party provides labour, knowledge, and experience.

• Sukuk (Islamic bonds): Islamic bonds give partial ownership. The holder gets assets.

• Istisna’a: It refers to the exception to the financial institution borrowing to its clients for a project that has not been produced yet, to provide capital with a contract.

investor.

a fixed share of the income from the

accordance with the basic rules of Islam.

In Islamic financial institutions, interest is

profit from the rental fee with the

These various forms of financing provided by both Islamic banks and the Islamic finance departments of international banks can be provided as part of a project finance package, in line with traditionally lending banks.

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THE SPREAD OF ISLAMIC FINANCE Islamic finance reached a significant size in the Middle East and

The size of the financial sector is 8-10 times the size of the global

Malaysia in the 2000s. It sees limited demand from Turkey, as the

gross domestic product. The 2008 crisis, in particular, highlighted

country is integrated into the global banking system. Over the

the risks of this imbalance. The rise of Islamic finance, the capital

past five years, Islamic banking has also started to grow in Africa

system which is based on net assets, really came after 2008.

and Asia.

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USA Thanks to the USA’s relatively small Muslim population, the

The American Finance House LARIBA, founded in California in

number of participating banks in which individual investors

the eighties, and the Amana Funds, founded in Washington,

have access to Islamic finance products is small. Although some

are two of the first Islamic financial institutions established in

banks in the USA have announced Islamic financing packages

the USA. The Dow Jones Islamic Market U.S. Index is designed

that contain products compatible with sharia, Islamic financing

to measure the performance of U.S. equity securities that have

instruments are not currently in high demand in this country.

been screened for adherence to sharia investment guidelines.

Other index providers such as Standard & Poor’s, Morgan Stanley Capital International, Financial Times Stock Exchange, and Russell Investment publish an Islamic stock index that attracts investors from all over the world.

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UK The country where Islamic financing is most common in Europe is England. As a financial centre, London is a magnet for many Muslim investors due to the minor time difference.

The UK’s Muslim population, of roughly two and a half million people, use Islamic finance products prolifically. The beginning of Islamic finance in the UK dates back to the eighties. Founded in 1982 to operate in the field of housing finance, Al Baraka International was the first Islamic financial institution in the UK. In 2005, the UK’s first Islamic investment bank was established, the European Islamic Investment Bank. Some of the retail and investment banks operating in the UK include Abu Dhabi Islamic Bank, Al Rayan Bank, Bank of London and the Middle East, Gatehouse Bank, and QIB UK.

Outside of the UK, there are just a few initiatives in Europe leading the charge for Islamic finance. Luxembourg is the first eurozone country to issue national interest-f ree bills and to offer 49 shariacompatible funds. The first Islamic bank in Germany, KT Bank AG, was established in 2015.

In Switzerland, Islamic insurance and takaful services are offered rather than broader Islamic financing. There are no Swiss laws specifically addressing Islamic finance so the Islamic finance products are subject to the same regulations as conventional instruments. However, the Swiss legal system is, generally, shariaf riendly, given that Swiss contract law is based on two key principles: the freedom of contract and the freedom of form.

AFRICA With $500 million worth of sukuks issued in Africa in 2018, the continent accounts

In 2014, the UK strengthened its position

for only 0.5% of the world’s sukuks in

as the centre of Islamic financing in

circulation. However the large Muslim

Europe, when it became the first non-

population, currently underbanked and

Muslim country to issue sovereign sukuk.

underserved, could be “a solid foundation on which Islamic financial assets, and

The London Stock Exchange is now a preferred global market for sukuk issuances.

London aims to be the leader in shariacompatible finance in the West. There are five licensed Islamic banks in the UK today and over 20 traditional banks offer Islamic financial products. Apart f rom this,

therefore profits, can grow rapidly,” say Moody’s analysts.

One clear example is Nigeria’s Sterling Bank, whose Islamic banking section experienced a 24% growth in profits last year despite a 16% contraction in total assets in the Nigerian commercial banking segment, according to Moody’s.

there are 65 interest-free bonds with a total amount of $50 billion on the London stock exchange, along with Islamic funds of $700 million assets.

EUROPE After the 2008 crisis, Islamic finance began to seem relatively safe to Western banks.

Interest-f ree bonds were a positive signal for new markets. Islamic funds provide an opportunity to reach a large amount of liquidity, and Islamic banks enable profits f rom local Muslim communities.

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SOUTH AMERICA In South America, Islamic finance is just getting started. With the opening of Trustbank Amanah in Suriname in 2017, the region had its very first Islamic Bank.

The other South American country opening up to Islamic finance is Guyana, with the support of the Islamic Development Bank. While there is currently no regulation on Islamic finance in Guyana, and also no Islamic bank, the country received $900 million in financial and technical assistance from the Islamic Development Bank over a three-year period, starting in 2018. The money will be used to develop Guyana’s economic infrastructure, rural development, educational capacities and improve trade and competitiveness. The establishment of Islamic banking institutions is planned for later.

LOCAL INNOVATION, GLOBAL RECOGNITION When the bulls are running, success stories are everywhere.

However, in complex and volatile times, the innovative alone lead the charge.

Cornèr Bank (Overseas) Ltd, ever a pacesetter, pioneer, and catalyst for positive change in The Bahamas, has just been awarded the Best Private Banking Services - The Bahamas 2020 title. It’s in recognition of Cornèr Bank’s reputation as a beacon of banking excellence and innovation, developing services and educational materials that give Bahamas-based investors local access to the full gamut of global investment opportunities, opening the door to a new financial era in the islands.

Cornèr Bank’s proven track record of bringing new and awardwinning offerings to the Bahamian financial sector, as well as educational services designed to inform new clients about these products’ use, have made the bank the clear choice.

THE BUILDER’S CORNERSTONE Every successful pioneering expedition launches f rom a wellstocked base camp - and Cornèr Bank’s Bahamian affiliate is no different. Founded in 1952 in Lugano, Switzerland’s third-largest banking centre, the Cornèr Bank Group focused on building a strong financial foundation to keep the ship sailing smoothly, even in rough seas. Today it boasts an exceptional Tier 1 capital ratio of 24.4% - three times higher than the minimum regulatory requirements - and has been listed first in financial soundness on The Banker’s Top 1000 World Banks list for four consecutive years.

From this excellent footing, Cornèr Bank Group has consistently extended its range of services and areas of operation to match increasingly global demand for sophisticated and seamless banking solutions. Its extensive list of financial services is offered f rom Switzerland, London, Milan, Vaduz, and of course, through Cornèr Bank (Overseas) Limited, Nassau, the capital city of The Bahamas. From its parent company’s deeply-rooted foundation, Cornèr Bank Bahamas has been successfully providing financial solutions in the islands since 1996.

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Local Innovation, Global R ecognition

The Bahamas has long been a prominent

Cornèr Bank (Overseas) Ltd’s CEO,

For Bahamas-based investors less eager

financial hub in the western hemisphere,

Christine Russell — a Bahamian national

to dive into markets unassisted, Cornèr

thanks to its proximity to both North and

herself, and a seasoned veteran of

Bank (Overseas) offers additional types

Latin America, its stable democracy, and

the Bahamian financial sector — best

of accounts alongside its Cornèrtrader

favourable tax environment (though no

articulates the significance of this

platform that provide users with

doubt the gin-clear waters, bone-white

achievement:

assistance and recommendations tailored

beaches, and balmy weather played a role as well). Without taxation on capital gains, inheritance, or income, The Bahamas has been a private banking nexus for decades — the benefits of which had only been available to foreign residents. Despite

to their preferences. Holders of Investment

“The advent of Cornèrtrader marked a milestone in Bahamian financial culture, as it empowers Bahamians like never before. For the first time,

serving wealthy foreigners in the country’s

we gave Bahamians and residents

extensive financial services industry for

alike the opportunity to engage in any

more than half a century, Bahamians

of the world’s major stock exchanges

had been limited to investing within their island’s coastlines. On the horizon would come unprecedented relaxations

from virtually anywhere - in their homes or even on the beach.”

Advisory Accounts receive proposals based on their personal level of risk aversion and investment goals. To take it further, Cornèr Bank (Overseas) offers Discretionary Investment Management Accounts, which are managed according to the client’s risk profile.

“I would like to thank the International Investors Awards, and the subscribers of International Investors magazine, for

in the archipelago’s foreign exchange

To a country previously limited to a shallow

recognising Cornèr Bank’s continued

regulations, opening the door for Cornèr

pool of relatively undiversified investment

leadership and excellence,” says Russell.

Bahamas to lead the charge.

offerings, this was a giant leap forward.

“It’s an honour and a privilege to accept

THE DAWN OF A NEW ERA

“With a click of a mouse, Bahamians could

but the true reward comes from knowing

In 2018, The Central Bank of The Bahamas

easily purchase anything they wanted on

that we are making a real difference in the

relaxed its restrictive regulations, and

Amazon, but until Cornèrtrader, they could

quality of our clients’ investment options.”

overnight, the doors to world markets

not say the same for a share of Amazon

were thrown open. Native holders of

itself. No longer are we just consumers,

Cornèr Bank (Overseas) Ltd’s product

Bahamian dollars were liberated and able

now we can be owners too.”

innovation, consistency in client

this award on behalf of my organisation —

communication, transparency and overall

to finally reap the benefits the world of trading and investing could offer.

COMMITMENT TO THE CRAFT

True to its pioneering spirit, Cornèr was

In a further show of exemplary

poised and ready to guide Bahamians

commitment to their clientele, Cornèr

through the unfamiliar waters of the

Bank (Overseas) offers the learning tools

international markets. The bank had spent

necessary to use its new and exciting

two years preparing to offer to Bahamians

products. At the Bahamian launch of

its online trading platform, Cornèrtrader,

Cornèrtrader, the bank’s director Luca

and its 2018 launch marked the first time

Salzborn summarised the efforts, saying,

a local firm had offered real-time access to

“we are committed to offering to all

the NYSE and the NASDAQ. Not only was

our existing and prospective clients’

Cornèr Bahamas prepared to welcome

continuous education with seminars or

new clientele, but the bank also positioned

one-to-one meetings about markets and

itself as a financial hub for newcomers

the use of our platform, as we believe that

navigating the markets, proving itself to

a key element for successful investing lies

be a true cornerstone of the Bahamian

in mastering the technical and financial

community.

aspects that go with it”.

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client satisfaction will continue to propel the bank not just to the top of the award podium, but into the future, setting the pace for financial services worldwide.

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THE GROWING IMPACT OF ROBOADVISORS

by Cameron Williams

Just a few years ago, there used to be a running joke about robots taking over the world. Back then, if I were to say that robots would be the norm for how we manage our money in the future, no one would have taken me seriously!

Today, in its most literal sense,

• How much investing experience do you have?

• How soon will you need the invested money?

• How tolerant are you of market volatility?

technology-based wealth management

• How comfortable would you feel if your

is actually starting to take over many of

portfolio dropped 10% in value in the

the mundane tasks related to how we

short term?

manage our money. These technologybased money management tools are

• What is the primary objective of

called “Robo-Advisors,” and they already

your investments? (growth, income,

represent a nearly trillion-dollar industry

maintain value, etc.)

within investing and wealth management.

• Do you have other invested assets?

WHAT IS A ROBO-ADVISOR? Not to be confused with a walking, talking

These questions are used as binary

robot, a robo-advisor is a technology-

indicators to the robo-advisor algorithm.

based algorithm that builds a custom

Your responses will direct the robo-advisor

investment portfolio for you based on

to build a portfolio that is in your best

a few common investing questions.

interest and customised to your investing

The algorithms are built with the aid

style based on your responses.

of financial experts and tech gurus, to automate some of the basic tasks in

For example, you may be a young

wealth management.

investor just starting out and looking for a diversified portfolio with moderate risk.

Here are some example questions asked

This will be noted upon answering some

when setting up a robo-advisor account.

investing questions, and the robo-advisor

These questions help the technology-

will automatically build you an investment

based algorithm automatically customise

portfolio that is well-diversified among

an investment portfolio for you.

different companies and investments, as well as create a portfolio with moderate risk tolerance.

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Examples of some of today’s reputable robo-advisors today are: • Wealthfront • Betterment • Acorns • Wealthsimple Many of these robo-advisors give their clients access to financial experts in case you have a more complicated question. In short, robo-advisors save customers and investment banks time and money.

It’s no question that robo-advisors make investing more convenient, costeffective, and less time consuming to manage.

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HOW ARE ROBO ADVISORS IMPACTING WEALTH MANAGEMENT GLOBALLY?

available to invest. Fortunately, one of the

For now, I think it’s safe to say that

goals of robo-advisors in the first place is

robo-advisors are great for basic wealth

to allow more people to invest with less

management activities such as portfolio

It’s safe to say that robo-advisors are more

required money to begin.

diversification, building customised

popular among younger generations,

investment plans to your personal risk

COUNTRIES ADOPTING ROBO ADVISORS FOR WEALTH MANAGEMENT

tolerance, portfolio rebalancing, and

The five countries that have the most

companies that offer their robo-advisor

In fact, that may be a clear indicator of

assets under management within the

customers the ability to set up a meeting

how the growth of robo-advisors will

robo-advisor segment are:

with a human financial expert for more

due to their natural understanding of technology, having grown up with smartphones and voice assistants.

trend globally with younger generations becoming more dominant as the years progress. Consider the following market trends, courtesy of Statista.com.

ASSETS UNDER MANAGEMENT

1. The United States - with $682.73 billion under management 2. China - with $74.57 billion under management

In 2017, the reported assets under

3. Japan - with $30.32 billion under

management within the robo-advisor

management

segment was $297.72 billion. Today, the total assets under management in 2020

4. The United Kingdom - with $18.23 billion

is projected to be $987.49 billion or over

under management

three times as much as reported in 2017.

5. Italy - with $15.27 billion under By 2024, the total assets under

management

management within the robo-advisor segment is projected to be $2.487 trillion!

NUMBER OF ROBO ADVISOR USERS

As you can see, the potential growth opportunity for robo-advisors is massive, and one that is likely to spread to more

In the year 2017, the total number of users

countries extremely fast. The stock market

within the robo-advisor segment was

alone has a total market capitalisation size

approximately 42.78 million. Today, the

of approximately $70.75 trillion, leaving a

total number of reported users for 2020

lot of untouched territory for the robo-

is 224.52 million. That’s over five times

advisor industry.

growth in just three short years.

Suffice it to say that we’re still in the The number of total robo-advisor users

beginning stages of the global impact of

in the year 2024 is projected to be

robo-advisors.

approximately 436.33 million users, or almost double what it is today.

ARE ROBO ADVISORS BECOMING THE NEW NORM?

AVERAGE ASSETS UNDER MANAGEMENT PER USER

Are robo-advisors taking the place of the

While the total assets under management

cases, yes. But I would consider the

and total number of robo-advisor users

growing robo-advisor trend more of a shift

have been on a drastic upward trend,

in how business is done than anything

the average amount of assets under

else.

traditional financial advisor? In some

management per user has slightly declined since 2017 from $6959 down to $4398. It’s expected to grow to about $5700 by the year 2020.

Traditional financial advisors will most likely always be needed.

Janine Menasakanian, the director of

What does this data suggest? More people

Key Accounts at one of the most famous

can invest today due to the growth and

investment companies today, Vanguard,

convenient features of robo-advisors.

believes that “Robo is great for simple,

Naturally, as younger investors enter the

self-directed work, but not for complex

market, they will likely have less money

planning activities.”

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tax-loss harvesting. Most robo-advisors are gateway products for investment

complex planning.

It’s a great option to start investing if you don’t have much experience, don’t have extra money to pay for a costly advisor, and don’t have complex investing needs like detailed estate planning, tax planning, and business succession plans. Roboadvisors are here to stay and will continue growing at an accelerated pace.

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THE CALAMITY OF UNCERTAINTY FOR BREXIT BRITAIN

By Rob McNamara

2020 will go down in history as a hard

Johnson’s government had it all under

that they had this all under control, the

blow to an already weakened economy,

control, we were reassured, and they were

universe threw a corona-shaped curveball.

but what will be its legacy for investor

well on their way to ‘Get Brexit Done’.

The catastrophic loss of life has been

confidence?

devastating. The economy is a secondary There was even optimism from the 3000

victim.

By September 2019, Brexit had already

Chief Financial Officers surveyed by the

made its mark on the UK economy.

DMP, working in collaboration with the

The Bloomberg Brexit Barometer tracks

According to the Decision-Maker Panel

Bank of England, which indicated that

economic well-being in the United

(DMP), set up by Nottingham and Stanford

investment might be set to increase. There

Kingdom and is updated daily, using

universities, investment had reduced

was a real expectation that investment

weather icons to indicate how inclement,

steadily by around 11% while productivity

could grow by as much as 4.6%, an

or not, the state economy is since the vote

had decreased by between 2 and 5% since

increase from 2.4% from the three months

to leave. Today it shows a dark cloud with a

the referendum result hit the headlines.

preceding. It would be absurd to claim

flicker of gif lighting protruding.

Analysts were bracing for hard times, but

that uncertainty had been significantly

at least ref reshed voter confidence in

dialled down, but investors were

MORE STORMY WEATHER

the Conservative agenda had put a little

beginning to see some strong reasons to

There can be no denying the fact that

fire back into the negotiation process.

invest once more in the UK.

much of the economic trouble right

Investors might have begun feeling like perhaps things were on the up.

IF ONLY THINGS WERE SO SIMPLE

now stems from the early impacts of COVID-19 and the lockdown, and not

The last thing the government needed

from Brexit itself. Yet both COVID-19 and

In January 2020, The Investor Confidence

was a global pandemic. Perhaps this

Brexit mean uncertainty, and uncertainty

Index had jumped by 21% to its highest

is why it took so long to accept the

is what investors are agitated about. The

level since November 2015, with increasing

magnitude of this new virus; they simply

combination is intimidating.

interest in UK investment. Traction was

could not believe their bad luck. Having

steady and the fearmongering had died

fought so hard to inject certainty back

down somewhat across the media. Boris

into the economy and reassure the public

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The calamity of uncertainty for Brexit Britain

The markets have recovered a little since their initial crash in March, but there is a real risk that a second crash is on its way.

As tensions rise between the US and China and another wave of redundancies across Europe looms as governments’ fiscal interventions tail off, a hard Brexit may just be enough to cause another sharp decline in investor sentiment. 2020 seems to be a triple threat year.

VIDEO KILLED THE RADIO STAR Face-to-face negotiations resumed last week between Britain and the EU after three months of video conferencing. They

IS THERE GOOD NEWS? In short, maybe. For some investors, the opportunity to buy cheap stock right now might be very attractive. If the second crash does come as expected, it could be a prime time to pick up a few bargains.

It’s still a brave person’s game though and buying shares on the decline isn’t always going to net you the long-term gains you’re looking for.

Diversification across a number of industries, especially renewable energy and technology, both of

quickly broke down as discussions reached

which showed strong potential pre-

an impasse, and the two opposing sides

pandemic, might offer a little light at

failed to reach even basic consensus on

the end of the 2020 tunnel.

the terms of the divorce. Investors fear now that crashing out of the EU will result

Uncertainty seems to be the presiding

in defaulting to World Trade Organisation

theme this year, and there is little

terms, which means unfavourable tariffs

indication this is set to change any time

and quotas. For many, this makes other

soon. For many, pragmatism is the new

markets outside of the UK look far less

normal and lack of information and clarity

uncertain, and thus alluring.

f rom the Brexit negotiations will only prolong that. It might be a year to wait

Asia is set to continue to benefit from a

and watch to see how things unfold, with

tumultuous Europe.

investors both inside and outside of the

Nausicca Delfas, the Financial Conduct

Perhaps we’ve had enough uncertainty

Authority’s Director of International,

already to last us a lifetime.

UK taking advice to not hold their breath.

was quoted in a recent interview with Bloomberg, “if the two sides fail to provide companies cross-border access, known as equivalence, equity and derivativestrading business could face disruption.

European investors might also be required to trade shares inside the bloc unless they’re given access to U.K. markets”.

Furthermore, with a continued lack of information from the negotiations about what it will cost to do business once Britain and the EU part ways, plenty of investors will see this uncertainty as a reason to keep their money away from such worrisome markets.

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ACCESS

ARCA FONDI SGR

AVATRADE

Access Bank Plc. is a leading full-service

Italy’s ARCA Fondi SGR is an asset

Since 2006, AvaTrade has been one of

commercial bank with a network of more

management company that is also

the most regulated brokers in the world.

than 600 branches and service outlets,

authorised to manage individual portfolios

Licensed in nine jurisdictions and running

spanning three continents, 12 countries

of institutional clients. The company was

local offices around the world, it provides

and 31 million customers.

born f rom the history and experience of

ultra-low spreads on over 1000 trading

ARCA SGR, founded in 1983 by 12 popular

instruments across a range of market-

banks.

leading trading platforms.

financial institution which combines

The distributor network is made up

Awarded ‘Best Affiliate Programme 2020’

a strong retail customer f ranchise and

of more than 120 financial regulated

by International Investor, AvaTrade also

digital platform with deep corporate

institutions operating across more than

offers a partners programme, ‘AvaPartner’.

banking expertise and proven risk

8000 branches and on-line channels,

With a wide selection of partnership

management and capital management

with a team of independent financial

models from introducing brokers, online

capabilities. The bank serves its various

advisors. The company has grown in time,

affiliates, trading academies and service

markets through four business segments:

expanding its network of distributors and

providers, AvaPartner contains attractive

Retail, Business, Commercial and

serving more than 800 000 final clients.

payment structures, robust customer

Corporate. The bank has over 900 000

With one of the largest distribution

relationship management (CRM) and

shareholders (including several Nigerian

networks in the Italian asset management

effective risk management tools. With

and international institutional investors)

industry and the long-standing presence

over 90 000 registered partners, more

and has enjoyed what is arguably Af rica’s

of its brand in the marketplace, ARCA

than $250 million paid in commissions

most successful banking growth trajectory

Fondi SGR is ranked by Italian investors

and up to $1000 CPA or 40% revenue share

in the last twelve years.

as one of the most well-known asset

– it’s no wonder so many partners choose

managers in Italy.

AvaPartner!

Listed on the Nigerian Stock Exchange since 1998, Access Bank is a diversified

Following its merger with Diamond Bank in March 2019, Access Bank became one of Africa’s largest retail banks by retail customer base.

As part of its continued growth strategy, Access Bank is focused on mainstreaming sustainable business practices into its operations. The bank strives to deliver sustainable economic growth that is profitable, environmentally responsible and socially relevant, helping customers to access more and achieve their dreams.

AWARD WINNERS I N T ER N AT I ON AL I NVESTOR MAGAZ INE | 0 83

Award Winners

BANCO INTERNACIONAL

BANK NIZWA

BANNER ASSET MANAGEMENT

Founded in Chile in 1944 as Banco

Launched in January 2013, Bank Nizwa

Banner is an experienced asset and funds

Israelita, Banco Internacional now uses

offers the people of Oman a unique

manager, specialised in debt and equity

a nationwide network of 12 branches

banking experience that combines Sharia-

products in the Australian real estate

and four business centres, staffed by

compliant products and services with

market. Banner was started in 2010 by

over 500 employees, as well as a suite of

today’s dynamic financial requirements.

Andrew Turner (CEO) and a small group

digital platforms to bring it closer to its

of initial investors and chiefly invested

customers and help it lead the corporate

Over the past seven years, the customer

the funds of its principals. The range

segment in the Chilean banking industry.

base has grown steadily as more

of investors has organically expanded

people seek an alternative solution to

to institutions, corporates, and other

Since 2016, Banco Internacional has

conventional banking. As Islamic banking

funds. All the original investors remain.

been the fastest-growing bank in Chile,

gains momentum in Oman, Bank Nizwa

This organic and gradual growth guided

with a business model that allows

continues to offer reliable competitive

and continues to guide the investment

for diversification between strategic

propositions for customers looking to lead

principles of ‘putting the investor first’,

segments, revenue sources and high

financially secure lifestyles.

through responsiveness, preserving capital

organic growth.

and earning a return.

The bank currently offers a suite of

Banco Internacional is majority-owned

financing, savings and investment

Banner is a registered provider of financial

by Inversiones La Construcción SA, a

products for individual customers. The

product in the highly regulated Australian

successful track-record and proven

bank also has an extensive portfolio of

financial services and funds management

financial stability, which bought the bank

services catering to SMEs, corporate and

sector. The head office is in Melbourne,

in 2015. Good governance, which is also

commercial customers, while providing

with a Sydney office, principals located

ensured through a reputable board and a

tailored products for investment banking

and active in Japan and Singapore. Its

solid management team with experience

and global markets. Bank Nizwa has been

investors are mostly located in Singapore,

in the industry.

consistently introducing forward-thinking

Hong Kong, Japan, Europe and Australia.

products and services, such as its online The bank’s values include delivering

and mobile banking solutions.

quality to every customer with the

The Banner funds have funded property projects valued at over AUD8 billion. A

highest ethical standards. Banco

Bank Nizwa launched its Strategy

majority of Banner’s investors are non-

Internacional incorporates sustainability

2020, a five-year vision to become the

residents, and it is well-versed in dealing

as a fundamental part of its management

Sultanate’s leading Islamic financial

with the needs of off-shore investors.

through four pillars:

institution. The strategy focuses on five pillars of development including financial

- Culture of service and ethics

performance, technological advancement,

- Responsible investment

market share, team and culture, in

- Inclusion, quality and access

addition to a progressive organisation.

- Contribution to public debate Guided by the principles of Sharia, and a firm dedication to giving back, Bank Nizwa has taken a leading role in promoting the social development of local communities.

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CORNÈR BANK (OVERSEAS) LTD.

ICU

PRIVATE WEALTH SYSTEMS

Cornèr Bank (Overseas) Ltd. has been

ICU is an independent asset management

Private Wealth Systems is a global

a paragon of excellence in the world of

and investment advisory firm specialising

financial technology company that is

private banking for over 20 years. Built on

in the emerging markets of Central and

solving the financial industry’s structural

a solid foundation of constant innovation,

Eastern Europe.

challenges of data, scale, and security in

strong financial positioning, and capital

order for those who manage complex

soundness, Cornèr Bank offers its globally

Founded in 2006 by senior investment

investment portfolios to have the

diversified clientele competitive and

professionals from ING, ICU is Ukraine’s

information they need to make the most

tailored solutions in an increasingly

leading asset manager with over $500

informed decisions.

complex world.

million in assets under management.

Their current strategy includes significant

The team’s collective experience includes

Cornèr Bank brings expert knowledge and

allocations to venture capital and

designing and building three of the

a wide range of top-tier financial services

distressed debt.

leading family office investment reporting

to serve not only international clients

and portfolio accounting systems.

but to Bahamians and residents alike.

ICU’s veteran investment team has

Through consistent product development,

experience in private equity & venture

The company’s private cloud suite of

Cornèr has diversified its offerings to

capital, high yield corporate debt,

multi-asset, multi-manager investment

include the Cornèrtrader platform and

distressed debt, restructurings and other

software includes account aggregation,

an array of investment services. Cornèr

special situations across a number of

data reconciliation, performance

Bank continues to experience remarkable

emerging markets. Investment decisions

calculation and client reporting that

growth and increased stability as it

are supported by robust macroeconomic

supports even the most complex global

takes pride in maintaining its stellar

and sectoral analyses from the firm’s in-

balance sheets.

international reputation.

house team of research economists.

Cornèr Bank (Overseas) Ltd. is an affiliate

ICU aims to provide their clients with

of Swiss-based parent company, Cornèr

superior risk-adjusted returns across

Bank Ltd, and is licensed with and

a number of asset classes. The firm is

regulated by both the Central Bank of The

expanding its reach into key European

Bahamas and the Securities Commission

markets via a combination of organic

of The Bahamas.

growth and acquisition and continues to expand the range its investment offerings.

I N T ER N AT I ON AL I NVESTOR MAGAZ INE | 0 85

TAIPEI FUBON BANK

TICKMILL

Taipei Fubon Bank, a 100% owned

The Tickmill Group, consisting of Tickmill

subsidiary of Fubon Financial Holdings,

Ltd, Tickmill UK, Tickmill EU and Tickmill

was created through the merger of Taipei

Asia, provides a secure and professional

Bank and Fubon Bank. The merger,

trading environment where clients can

formally completed on the first of January

trade a plethora of instruments including

2005, was the first in Taiwan’s banking

forex, stock indices, precious metals,

history involving a state-owned bank

bonds and energies.

and a private bank. As of April 2020,

With innovative tools and advanced

Taipei Fubon Bank had total assets of

technology, Tickmill facilitates trading for

NT$3.168 trillion and operated a total of

professional, institutional and retail clients

127 domestic branches and five overseas

across the globe, giving access to over 80

branches plus one office. It has the most

financial instruments, spanning four asset

branches in Taipei of any private bank in

classes.

Taiwan.

Tickmill UK Ltd is regulated by the UK Backed by a highly efficient channel

Financial Conduct Authority (License

platform, an unrivaled line of products

Number: 717270). Tickmill Europe Ltd is

and services, and extremely effective

regulated by the Cyprus Securities and

operations, Taipei Fubon Bank is

Exchange Commission (License Number:

determined to emerge as the preferred

278/15). Tickmill Ltd is regulated by the

financial strategy partner for customers

Financial Services Authority of Seychelles

in the Greater China market and move

(License Number: SD008). Tickmill Asia

steadily toward the vision of becoming “a

Ltd is regulated by the Financial Services

top regional bank in Asia.”

Authority of Labuan Malaysia (License Number: MB/18/0028).

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