Regulation 29ers

With amendments to Regulations 15, 28 and 29 in the offing, the local investment landscape must surely be an interesting environment, so much so that we are experiencing a growth in the number of new investment managers, aptly titled “Regulation 29ers”.
I am certainly under the impression this is the case. Just recently, a certain stock-broking firm underwent cosmetic changes and created new business divisions. Granted no SPV was announced in that direction but I am almost certain its almost a matter of time. Another, of course through its holding company announced the creation of an SPV.
Stock-brokers nogal, hmmmmm.
And then there’s that low-income insurance crowd, bankers and now even diamond miners. They too seem to be having one eye on a whole lot of pension and insurance money. Well they haven’t quite announced their intentions and NAMFISA is being non-the-wiser but I am not fooled.
Its a surprise we haven’t seen much activity from the established firms doing business in Sandton but I am thinking its only a matter of time.
And while these comical activities play themselves out how long before the tenderpreneurs/gomchas (Knowledge Katti) get wind of this and want a piece of the action too. It can’t be too difficult right? Well just over 50 applications were received in 2015 for Unlisted Investment Managers and Special Purpose Vehicles according to NAMFISA. I wonder how many were approved and what the status of these financial managers and vehicles are at this point in time.
That was just last year June, eish!
Let’s not even mention the existing commercial banks. You would swear these chaps are not profitable enough. Look at the big four with the exception of Nedbank. All are active in the investment space and one announced the anticipated arrival of its big fancy newly established asset manager from South Africa. Are they too perhaps looking at this lucrative piece of the pie called Regulation 29.
I can only think of all the projects they are conjuring right now. The standard shopping centres and various residential developments in sleepy towns across the country. You know Mr. Price is battling now that the Angolans have made way for Lobito and the municipalities are sitting on hectares of land which they say will be pricey to develop.
Well I do not know what the future holds but in the bigger scheme of things it can only be positive for the strength of the financial markets. I will choose to be positive despite the fact that many of these applications on the face of it are not genuine I believe. While profit remains a big motive all this smacks in the face of trying to make a quick buck.
The amendments will be made, mistakes will be made and lessons will be learned, but I bet you, these comical developments will surely present themselves again in another guise and another time frame, in keeping with the old saying, the more things change, the more they stay the same.

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