NFB FINANCIAL SERVICES
NFB FINANCIAL SERVICES
Drawing On A
Wealth of Knowledge PRODUCTION: Timothy Reeder
For NFB Financial Services, everything is centred around clients’ needs, wealth and future financial wellbeing. In the last two years NFB has added another R3 billion to its assets under management to take the total to R28 billion, and continues to grow yet further both organically and through acquisition.
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Since 1985, NFB has set about establishing itself as one of the country’s leading broad-spectrum financial services businesses, specialising in independent financial advice, products and services to high worth individuals, trusts, businesses and institutions. The Group has dealings with all major registered South African banks, as well as a select number
// WE EMBRACE KNOWLEDGE AS A MECHANISM FOR SUSTAINABLE WEALTH // 2 / www.enterprise-africa.net
of preferred international, financial institutions within the banking, insurance, listed equity, government and quasi-government sectors. The development of the company is outlined by NFB Financial Services Chairman and founding partner Mike Estment, whose outfit was somewhat more modest than the company’s current operation numbering some 150 staff and one of the country’s largest assets under management portfolios. “There were five of us in the beginning,” he relates, “of which I am unfortunately the only remaining founder from April 1985. The rationale behind the creation was to have something we owned as opposed to something we worked for. We were all into wealth management and we all
came from banking backgrounds, so we wanted to establish something that had a long-term legacy and wealth creation opportunity both for ourselves and others, and it’s worked out rather well. “It certainly hasn’t happened without headwinds,” counters Estment, “I like to climb mountains and remember the party at the top rather than the very tough bit between base camp and the summit, but it has been challenging.” PERSONAL, COMPREHENSIVE APPROACH Throughout a lifetime punctuated by frequent success, the NFB Group has prided itself on the direct and personal relationships its clients enjoy with its network of advisors and support staff, which underpins its entire investment
INDUSTRY FOCUS: FINANCE
// OUR PRINCIPAL AIM IS TO PROVIDE BESPOKE PRIVATE WEALTH MANAGEMENT EXPERIENCES, UNPARALLELED LEVELS OF PERSONALISED SERVICE AND EXPERTISE // philosophy. “We embrace knowledge as a mechanism for sustainable wealth,” the Group says. “Our knowledge is your key to a future of financial peace of mind.” It follows that NFB is committed to knowing every aspect of each client’s wealth plan and how it has evolved over time, meaning it can then plot its continuing evolution. “We have been building real relationships by serving the best interests of our high-net-worth clients and their families for more than 30 years,” NFB states. “Our principal aim is to provide bespoke private wealth management experiences, unparalleled levels of personalised service and
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expertise, tailored financial strategies and unique investment solutions and opportunities across a full range of asset classes.” The entire NFB makeup also numbers Advisor Collaborations and Institutional Wealth, but it is the Group’s Asset Management provision which has proven most fruitful to date, as Estment explains. “NFB’s client base or assets under management is approximately R25 billion. Of that, probably 23 would be individuals and their family trusts and less than 10% is what we would call institutional - such as pension funds and universities.” Launched in 2001, NFB Asset Management is among South Africa’s
leading independent providers of both local and offshore single- and multi-manager funds. Investors benefit from dynamic asset allocation, considered fund selection, optimal portfolio construction and transparent reporting expertise. At the core of the service are longterm investors who believe in making active decisions at the asset allocation level, which are the implemented using passive instruments in single manager portfolios. RECOGNITION OF EXCELLENCE It is a holistic approach to asset management and one which has brought the NFB Group some notable success. Recognition of the NFB Ci Cautious Fund of Funds was shown in its receipt of two accolades at the prestigious 2017 Raging Bull Awards, widely known as the Oscars of the investment management industry. The Awards were originally established to honour funds and
NFB FINANCIAL SERVICES
fund managers that consistently earn outstanding returns for South African retail investors, and for the five-year period to the end of December 2016 took home some significant awards. Fund Manager, Paul Marais says NFB Asset Managers’ investment philosophy is based on their key beliefs: “First, that asset allocation drives a significant portion of overall investment returns. We also believe that markets are inefficient and that they swing between periods of over- and under-valuation. “We also believe we are able to exploit these circumstances to the benefit of investors invested in the portfolios we manage. We do not believe in optimisation, back-testing or forecasting, as these are all materially flawed processes in one way or another.” These prizes underline the longterm philosophy and robust investment processes which NFB has developed over the last ten years, and highlights the importance of the investment management team responsible for guiding these.
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WHERE NEXT? South Africa’s is a notoriously unpredictable economy, which makes preparation more vital than ever. Mike Estment has long been an advocate of artificial intelligence (AI) and roboadvisors, as two important means of further improving NFB’s operational methods. “Robo-advising remains a
// WE ARE SLICK IN OUR PROCESSES BUT OLD-FASHIONED IN TERMS OF CLIENT CARE AND THAT ALL COMES BACK TO US BEING SAFE AND MAKING PEOPLE FEEL SAFE //
very light component of what we do, while AI is a critical aspect and in five years’ time will be the only ticket to the game,” he states. “Robo-advising is still in its early days because so many clients still need face time. We are slick in our processes but old-fashioned in terms of client care and that all comes back to us being safe and making people feel safe.” In an economic climate which remains ever unclear, Paul Jennings, Private Wealth Manager of the NFB Group, has identified the scope for progress during such uncertain times in South Africa, with NFB itself perfectly placed to spark the required change. “There is a need and opportunity, both locally and internationally, for radical, economic transformation,” he says. “South Africa can be at the forefront of change. We are a young nation, at the
tip of this vast continent with enormous potential both here and the rest of Africa, and we all have a role to play in influencing a better South Africa and a better world.” A combination of not losing sight of the values which has served them so well to date, while embracing the developments occurring within the industry, will keep NFB growing and succeeding. “We are engaged consistently in targeting acquisitions,” Estment tells us. “Financial services is a key asset of any economy and it is scalable. We continue as entrepreneurs to deliver for our clients and that is service and advice that we like to believe is without peer.”
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DECEMBER 2018