the sanlam group impact of data on strategy: the sanlam emerging markets africa growth story august 2014

Transcription

1 impact of data on strategy: the sanlam emerging markets africa growth story august 2014 Insurance Financial Planning Retirement Investments Wealth

2 agenda Brief overview of strategy and strategic positioning Strategy Business model Africa The Growth Opportunity The Sanlam Emerging Markets Story The full diversification story agenda

3 overview of group strategy & strategic positioning focus on growth markets

4 Capital Efficiency Returns (ROGEV) Growth / Operational Efficiency strategic focus maximise shareholder return Net Business Flows Diversification Operational Efficiency Optimal Application Strategic Investments Return of Excess overview of group strategy & strategic positioning

5 core strategic objectives a bird s eye view of strategy South Africa Delivery of sustainable growth International Creating a platform for future growth Maximising return on Investment in existing business Efficient and effective management Sourcing new growth opportunities Identification of core markets for growth & expansion Effective capital management overview of group strategy & strategic positioning

6 five strategic pillars underpinning business model Improving performance through top-line growth Increasing market share in key segments Diversifying the base (including geographical presence, products, market segments and distribution platforms) Improved operating and cost efficiencies (including quality) Prioritising Sanlam s international positioning (diversification) Improving capital-efficiency on an on-going basis Embracing and accelerating transformation of the Group overview of group strategy & strategic positioning

7 Africa a brief look at the growth opportunity

8 % of GDP the growth opportunity life insurance penetration in africa and brics 11.4% 5.4% Global average: 3.7% 1.9% 0.9% 1.1% 0.5% 0.4% BRIC average: 1.9% 0.1% 0.2% 0.1% South Africa Namibia Botswana Malawi Kenya Ghana Zambia Tanzania Nigeria Uganda Source: Swiss Re and AXCO africa

9 growth opportunity GDP growth / life insurance penetration HIGH Nigeria Ghana Tanzania Zambia Botswana GDP growth Malawi Uganda Kenya Namibia LOW insurance penetration HIGH africa

10 growth opportunity GDP growth / general insurance penetration HIGH Ghana Nigeria Tanzania Zambia Botswana GDP growth Malawi Uganda Kenya Namibia LOW insurance penetration HIGH africa

11 sanlam emerging markets a brief look at the business model

12 sanlam emerging markets

13 critical success factors simple strategy focus on delivery and implementation passionate people partnerships (similar values and culture) entrust local boards and management to run operations strong governance relevant information sanlam emerging markets

14 to be a leading financial services player in selected emerging markets improve, expand and grow our existing business invest and do more with current businesses and partners expand gradually into new emerging markets refine organisational capacity and structure to support growth ensure strong governance, compliance and reporting procedures underpinned by a culture of execution and delivery sanlam emerging markets

15 improve, expand and grow our existing operations sustainable and diversified top-line growth cost management system optimisation and process standardisation conservative but optimal capital management client-centricity new products and market segments high-performance teams capitalise on strategic relationships sanlam emerging markets

16 invest and do more with current businesses increase shareholdings where it makes sense new businesses with current partners leverage strategic relationships across countries leverage from centre and across countries sanlam emerging markets

17 expand into new markets Consider: population size and growth potential (GDP) insurance and retail credit penetration political stability ease of doing business potential for playing a technical partner role (lack of technical skills) sanlam emerging markets

18 COE Specialist role SEM Support Country CEs MARKETS SEM structure and capacity to support growth Botswana Namibia Africa India SE Asia expats expats expats expats Structural Growth Botswana Namibia Africa India SE Asia HR/Act Finance + Actuarial + Risk Mgt + Compliance Mgt Marketing + Corporate Services / Ops + IT / HR General Insurance / Asset Management / Life Insurance + EB Medical (outsource) / Credit Product Management Distribution Profit optimisation (* specialists to attend Exco s & Boards on invitation basis) SCM SPF SIM SEB Santam Group Office sanlam emerging markets

19 strong governance, compliance and reporting adherence to minimum Group governance standards Sanlam Code of Ethics zero tolerance approach to financial crime and unlawful conduct sanlam emerging markets

20 the full diversification story over the years

21 SEM s growth timeline African Life Shriram Life Shriram General Letshego Uganda FBN Life Nico Life Nico Holdings Namibia Medical Shriram Capital P&O STFC CIH NICO General Santam Namibia MCIS Soras Oasis MicroEnsure 2005 (November) the diversification story

22 diversification international positioning RSA based Rest of Africa Botswana Ghana Kenya Lesotho Malawi Mozambique Namibia Nigeria Rwanda South Sudan Swaziland Tanzania The Gambia Uganda Zambia India Malaysia Philippines South-East Asia Developed markets UK / Ireland Switzerland Australia USA Developed Markets Emerging Markets - Direct presence Emerging Markets - Indirect presence the diversification story

23 COUNTRY LIFE ASSURANCE SHORT-TERM INSURANCE ASSET MANAGEMENT CREDIT BANKING HEALTH OTHER Botswana Botswana Life BIHL SURE Burundi SORAS SORAS Botswana Insurance Fund Management Letshego Bank Gaborone Ghana Enterprise Life Enterprise Insurance Co India Shriram Life Shriram General STFC, SCUF Kenya Pan Africa Life Pan Africa Asset Management Letshego Lesotho Letshego Malawi NICO Life NICO General Insurance NICO Asset Management NBS Bank Malaysia Pacific & Orient Mozambique NICO Vida Letshego Namibia Sanlam Life Santam Sanlam Investment Management Letshego Bank Windhoek Nigeria FBN Life Oasis Insurance Philippines Monarch Rwanda SORAS SORAS Letshego South Sudan Letshego Tanzania African Life Assurance NIKO Insurance Letshego The Gambia Enterprise Life Uganda Sanlam Life NIKO Insurance Letshego SANCARE Zambia African Life Assurance NICO Insurance African Life Financial Services Cavmont SANCARE the diversification story

24 diversification growth markets delivering value Net VNB 2003 (R232m) Net VNB 2013 (R1 320m) Namibia 1% Rest of Africa 9% Botswana 5% Namibia 4% Other international 3% SA Traditional 99% SA Entrylevel 28% SA Traditional 51% the diversification story

25 diversification increasing contribution from growth markets Contribution to group net operating profit 2003 R1 968 million Namibia 1% Other international 1% SA Entry-level 7% 2012 R4 030 million 2013 R5 429 million Rest of Africa 2% Botswana 5% Namibia 4% Other international 5% India/ Malaysia 7% Rest of Africa 3% Botswana 4% Namibia 6% Other international 6% SA Traditional 98% SA Entry-level 10% SA Traditional 77% SA Traditional 64% the diversification story

26 diversification diversified earnings base Group Equity Value Net operating profit Credit & banking 8% Admin, health & other 11% Credit & banking 15% Admin, health & other 1% Investment management 13% Investment management 14% Short-term insurance* 17% Life business 51% Short-term insurance* 7% Life business 63% * General insurance the diversification story

27 contribution from businesses outside of south africa increasingly diversified base Net operating profit Net VNB Group Equity Value 74% 84% 79% 85% 80% 85% 6% 20% 5% 11% 3% 18% 1% 14% 7% 13% 6% 9% South Africa Emerging markets Developed markets the diversification story

28 thank you