Financial solution provider Hansard has plans to launch in Japan in the first quarter of 2021.
This comes a year after Hansard International was granted an investment manager licence in the Asian country.
Within its financial year 2020 results, ending 30 June, the firm said it plans to bring to market its “locally-licensed investment product in Japan” with its first distribution partner.
Plans
International Adviser spoke with Gordon Marr, group chief executive, and Graham Morrall, global sales and marketing director at Hansard, to discuss Japan, expansion plans and its FY 2020 results.
Marr said there are a “number of discussions in place with bank distributors” in Japan, which are “quite mature”.
“We’re moving into the latter phases, documentation, due diligence and quite a lot of detailed things,” he said. “We are moving forward on a number of fronts, probably slightly behind where we wanted to be, but that’s really just covid-related.
“We are looking to be able to launch in the first quarter of next year and that’s certainly with one fairly substantial distributor.
“Then we’ll roll out further ones after. I think the market there is still good. We don’t think covid is going to impact sales.”
Morrall added: “The model in Japan is brand-new for us. It is totally localised, locally licensed, Japanese branch staffed with Japanese employees selling through Japanese banks to Japanese customers.
“It’s not our normal or traditional model that we’ve been running for years. It’s not an easy market to get into and get accepted as a foreign company. You’ve also got to realise that we’re a foreign company without a mega brand, so equally, that’s challenging.”
Pipeline
Within its FY 2020 results, the firm said: “We will continue to drive our strategic alliance with Union Insurance in the UAE and hope to pursue opportunities to replicate this model in other targeted jurisdictions over the coming years.”
When IA asked about the “targeted jurisdictions”, Marr said: “We’ve certainly done some work and we have some ideas, but I don’t think we want it out there what they might be at this stage.”
Morrall added: “We need to get past the Japan launch before we start talking about the other countries that we may have an idea about.
“Once we get past the launch of Japan, we’ll start to look at one or two of those in a little bit more detail.”
Results
Hansard’s 2020 results were very positive despite the coronavirus pandemic.
Profit before tax was £4.7m ($6m, €5.15m), up from £4.6m in the previous year. The firm said this reflects a number of factors on both the revenue and cost side.
Fee and commission income came in at £49.5m (2019: £48.5m).
New business levels were £159.8m, 2.5% higher than FY 2019, which was £155.9m. The primary driver of growth in 2020 was the firm’s Latin American operations, which was up 44% for the year.
As of 30 June 2020, assets under administration were £1.08bn, a very similar figure to the previous year.
Good year
Marr said: “Overall, we had a very good year. All our key metrics improved year-on-year, new business profit, solvency and cash, despite the impact of covid.
“It would have been an even better year without that, but I think we are content that, in the circumstances, we’ve had a pretty solid, if not good result.
“We’re obviously delighted that we are paying a dividend, which is probably against trend in the industry, I think that reflects on the sort of financial strength of the business.
“I think our technology was very important in allowing us to manage the impact of covid. At the front end, with how we develop business and relationship with brokers, the technology was also very useful.
“Some of the high points in terms of distribution is clearly LatAm, where we really developed the market quite strongly.”
LatAm
When IA asked about the growth in LatAm, Morrall said the firm has “a very good distribution network” in the region, after it “spent three or four years building it up to where we have it today”.
“We’ve got more resource going in there, more time spent on it, more marketing material produced in the languages required, and these types of things have had a positive effect.
“And remarkably, in the last quarter with covid and LatAm being hit like no other place on earth from a regional point of view, our business did really well.
“Our brokers down there really pulled out all the stops to get even more online than they were.
“There’s huge populations down there. And it’s not like it was 30 years ago, you got emerging middle class and people with money. It’s very close to the [United] States as well.
“It’s a highly competitive market, but we’re doing pretty well and we’re hoping to see similar level of business over the course of this year as well.”
Covid disruption
With the positive FY 2020, does the firm expect covid to hinder its results in 2021?
Marr added: “I think it’s hard to predict, but I think we are quietly confident. Certainly, our finances will be stable. We will see some improving trends over time with our financial position.
“But I think with new business, we’re quietly confident we’re seeing a pickup. We’re seeing some of our pipeline looking better.”
