Wealth means different things to different people. It is not only about assets, but about freedom, choice, connections, experiences and protecting the things that matter most to individuals. This might include saving for a child’s education, diversifying one’s assets, and providing for retirement. We work with our clients to develop personalised solutions tailored to their unique aspirations.
In South Africa, our clients have invested over R550 million in 63 000 tax free investment accounts, and over R440 million in 13 000 auto-share investment accounts. Tax free investment accounts are easy to open and offer significant tax advantages and wealth accumulation benefits. Auto Share Invest provides an accessible option for investors who are just starting out and are still building portfolios. Clients can invest as little as R500 per month. Standard Bank buys the shares chosen by clients from our range of JSE selected shares, at a reduced cost.
In October 2019, we launched 1nvest, a specialist index tracking fund manager, in South Africa. It is 50% owned by Liberty and 50% by Standard Bank Group and brings together extensive financial market knowledge and award-winning unit trusts (UTs) and exchange traded funds (ETFs) from Standard Bank and STANLIB. 1nvest provides a comprehensive index product range which includes 28 UTs and ETFs with circa R12 billion of assets under management across multiple asset classes (equities, fixed income, commodities and property) and geographies (South Africa and offshore markets). It provides clients with instant access to some of the popular market indices, under one umbrella, helping them to invest simply, transparently and cost-effectively.
Stanbic IBTC Pension Managers Limited is Nigeria’s biggest pension fund administrator. We have over 1.7 million retirement savings account (RSA) holders nationwide, with assets under management in excess of N2.8 trillion (R112 billion). We paid N3.26 billion (R131 million) to over 55 809 retirees in March 2019 and have paid out over N635 billion (R25 million) to retirees since the pension fund commenced operations in 2006.
As much as 70% of Nigeria’s working population is in the informal sector. We want to ensure that they too have plans in place to protect them against poverty in old age. In 2019, Stanbic IBTC Pension Managers Limited launched a micro pension campaign, ‘Game Plan – Retire Well’, to encourage workers in the informal sector, who are not covered by the current contributory pension scheme, to take-up our micro pension product. The product offers access to various incentives, including flexible contribution remittances, and the opportunity to make withdrawals prior to retirement. It also aims to help mobilise the capital required for investment in critical sectors of the economy, while improving financial inclusion. Stanbic IBTC has launched an ongoing programme of public meetings, meetings with business groups, public awareness programmes, and television and radio advertising to raise awareness of the product.
Helping people buy a home is one of the most important roles we play in society. A home provides shelter and dignity for families and provides an opportunity to build inter-generational wealth. Standard Bank is South Africa’s largest lender to the affordable housing sector, with a 27% market share. We are also working directly with the government and NGOs in Zambia to tackle the country’s 1.5 million unit housing deficit.
AFFORDABLE HOUSING IN SOUTH AFRICA
The Financial Services Code requires banks to provide affordable housing for consumers that earn a gross income between R3 500 and R24 300. Standard Bank’s affordable housing book is valued at around R25.6 billion. In 2019 we registered 5 667 new affordable home loans. As the largest lender in the affordable housing sector, with a 27% market share, we have almost 99 500 customers on our books.
We work closely with the National Department of Human Settlements, National Housing Finance Corporation and the provincial housing departments to help our customers access the Finance Linked Individual Subsidy Programme (FLISP) offered by the government. The programme targets the ‘gap market’. These families find it hard to qualify for housing finance, as their income is regarded as too low for traditional mortgage finance from banks, but too high to qualify for the government free basic housing subsidy scheme. Qualifying households can access a FLISP subsidy, ranging between R27 960 and R121 626, depending on the applicant’s monthly income.
In South Africa, Standard Bank’s Home Services property valuation guide, LookSee, enables anyone buying or selling a home to access information relating to a property and its value. Anyone can access our free guides to help them make informed decisions. The information is available 24/7, and includes details such as:
SBSA launched our sectional title index in 2019. The index informs a customer of various things to consider when purchasing a sectional title property. It uses the financials of the complex, the price growth within the complex and the Risk Quality Grade within the area. On this basis, the index can inform the customer whether the complex is excellent, good, prospective, average or speculative. This helps our clients ensure they’re making a well-informed decision when investing in the purchase of a home.
We do everything we can to help our customers stay in their homes. However, in 2019, we regrettably had to enter legal processes with 1.63% of our customers who were in default, after all alternative arrangements had been exhausted (down from 5% in 2018). During 2017 and 2018, we undertook a series of engagements with government officials, members of parliament, and civil society groups to gain a better understanding of what we can do to try to prevent mortgage defaults. We have since implemented various changes, including more proactive communication with stakeholders regarding the processes followed in cases of default, and about the options available to clients, including loan restructuring and assisted sales. We have also increased our focus on ensuring the courts have the relevant information on steps taken to try to assist clients in distress prior to taking the matter to court.
KEEPING PEOPLE IN THEIR HOMES: THE LEGAL PROCESS WE FOLLOW WHEN CLIENTS FALL BEHIND ON THEIR MORTGAGES
Zambia’s housing deficit currently stands at 1.5 million units and is projected to double according to a study by UN Habitat. The government has encouraged the private sector and civil society to partner with it to address the challenge of housing across all income brackets. In response, Stanbic Bank Zambia implemented the Buy-a-Brick initiative, which was formally launched by President Edgar Chagwa Lungu in Chibombo in 2019. We run the initiative in partnership with the Ministry of Housing and Infrastructure Development, the People’s Process on Housing and Poverty in Zambia, The Zambia Homeless and Poor People’s Federation, and Slum Dwellers International. Our objective is to help low-income households access decent housing, and to explore alternative building methods toward lowering the cost of housing. Stanbic Bank Zambia has dedicated a third of its total CSI budget (an equivalent of 1% of its annual profit) to the campaign. The government has pledged K10 million (R10 million) towards the initiative. Stanbic’s Buya- Brick account allows businesses and members of the public to make donations toward buying building materials for the programme. Stanbic employees are also contributing to the fund, with different departments raising funding through various initiatives.
Standard Bank Group subsidiary, Liberty Holdings, provides life insurance and investment management. Standard Bank complements Liberty’s offering with bespoke services for targeted client groups.
In 2019, we launched a standalone app for car and home content and structural insurance designed specifically for millennials. Clients receive a premium discount if they pass a digital driving test built into the app’s telematics capabilities (the first 300km and 25 trips are tracked). Our discount is guaranteed for 12 months. If clients continue to use digital monitoring of their driving patterns, they receive additional rewards.
Standard Bank clients can make authenticated payments to their own or other international accounts using our mobile app, online, in branches, or using Shyft Global Wallet.
In 2019, to expand access to remittance services, we partnered with Rewire, an international fintech, to offer remittance services to migrant workers from across our 20 African countries of operation. Rewire’s crossborder international banking service enables migrant workers to deposit money into a digital bank account, which comes with a debit card for local needs and a remittance service for transferring funds home. The product is available in selected European markets, and there are plans to expand into Asian markets in the future.