South African companies and investors have made the news in recent years with their continuous investment and expansion in the rest of Africa to tap into the continent’s growth story and seek higher returns. However, Standard Bank – which operates in 18 African countries – has seen an increasing trend of individuals in the rest of Africa investing in South Africa, especially by high net worth individuals (HNWIs).
According to Margaret Nienaber, global head of Standard Bank’s Private Clients business, while many African HNWIs are looking to diversify their offshore investment exposure in areas like the UK or Jersey, they are also expressing interest to increase their investment in South Africa.
“There has been a very strong focus with [Standard Bank] to offer South African clients an opportunity to invest in the rest of Africa, but there is also the reverse of that happening now. There is the ‘rest of Africa’ clients saying, ‘how do we invest in South Africa’,” Nienaber told How we made it in Africa. “And we have also seen an increase drive for Africans to buy property in South Africa.”
Nienaber said she has seen a particular interest by Standard Bank’s wealthy Nigerian clients to invest in South Africa, adding that this was noteworthy considering the investment opportunities that exist in Nigeria today and how well its stock exchange performed last year.
“One of the things that I picked up quite strongly was that these clients are very interested in networking opportunities… So I think South Africa becomes an obvious choice because it’s an established market, but by investing in South Africa, getting property [in South Africa], spending time [in the country] they also get to interact with like-minded individuals that open up business opportunities.”
Standard Bank’s Private Clients business was established a few years ago to cater to the group’s growing high net worth clients base, who are defined as people with the potential for net investable assets in excess of US$1m. Between 2008 and 2013, Standard Bank’s Private Clients business in Africa grew by 51% in terms of new clients, and 123% in assets under management, according to Nienaber.