Having clear regulation everyone can follow has been regarded by financial services players in the United Arab Emirates as a hugely important way of getting the most out of the region.
This was one of the key messages of the financial services roundtable discussion hosted by International Adviser in Dubai, which ranged across a number of topical issues.
Participating firms were Investors Trust Assurance, Nedbank Private Wealth and Hansard International.
The big switch
Phil Story, ITA’s head of distribution in the Middle East and Africa, highlighted how throughout the Middle East the regulatory environment is changing massively. “As a new entity coming here, we are trying to find the best way forward to achieve the biggest growth, not just in the UAE but throughout the Middle East, Africa and surrounding territories as well.”
Story, who has been based in the UAE for the past 11 years, said five to 10 years ago brokers were mainly selling regular savings plans, but during the past couple of years there has been a switch to lump sums and a greater focus on retirement planning.
“We’re hoping a more holistic approach will come in, with new products on the market that will help advisers do the right job for their individual clients.”
Story added that some of the newer businesses in Dubai were shunning indemnity commission in favour of non-indemnity trails and renewals.
“They want to build a long-term value in it. In Singapore, Hong Kong and other places, it’s being forced on them. They know it’s coming and want to get ahead of the game.”
Flight to quality
Graham Morrall, global sales and marketing director at Hansard International, also picked out the move towards doing lump sum investment business with western expatriate distributors, together with growing enforcement of existing regulations and issuance of new rules.
Taking a different angle on key regional trends, Andrew Bates, head of the Middle East for Nedbank Private Wealth, said advisers and the private clients alike were “taking a flight to quality, when it comes to their fund selection”.
“We have seen a substantial increase in our discretionary fund management services, because, sadly, people have been caught up in single- trending funds, which have bitten a number of clients. There were often exorbitant fees paid up-front to advisers for marketing and distributing these funds, but it is the client who has been left carrying the can.”
Bates added: “Advisers are becoming more aware of investment opportunities and what the actual underlying investment is, but clients are still in search of income-producing assets as well.”
