One of South Africa’s major lender said it will diversify its operations into life insurance.
Investec has its strengths in private banking and asset management, said it would offer life insurance from the third quarter of this year to fill what it sees as a gap in its product range.
“I think it is a hole in our offering and it is something we think we can be pretty successful at,” CEO Stephen Koseff said during the company’s results presentation. “We have had a life insurance licence for decades but we never used it and we feel it’s a very appropriate product to offer to our client base.”
An analyst covering Old Mutual, Neelash Hansjee told Reuters that he expansion is part of the shift by banks, such as Firstrand, to offer insurance and other products that can be added without big capital outlays, amid greater competition in banking from the likes of Discovery and Capitec.
“Insurance products offer better returns and Investec has access to clients and distribution for the products. It also serves to improve the fee income or annuity type revenue for the business,” said Hansjee.