Private Banking and Wealth Management, in its breadth and depth, is increasingly becoming a much-sort-after financial service in Africa, thanks to the economic renaissance happening across the continent and the emergence of a solid class of the ‘nouveau riche’ and the surge in pension funds.
Africa is largely regarded as the last emerging opportunity. The continent has been attracting investments from portfolio managers looking
for best returns. After years of sustained capital inflow to countries like Kenya, Nigeria and Egypt, the results are becoming evident. The continent’s entrepreneurs and middle class have been growing steadily over the last two decades and as a result, disposable incomes have grown exponentially. This has given rise to a plethora of investment schemes, which in turn have led to the growth
of intermediaries. These are fund manager
and investment advisory firms, set up either as subsidiaries of commercial banks, insurance companies or as standalone boutique firms.
Whereas Africa is known for its struggles against poverty, a growing number of African entrepreneurs is successfully creating and acquiring wealth through enterprise and hard work.
A large part of Africa’s current economic upsurge is driven by family businesses while over half of global GDP is created by family businesses.Some of the world’s wealthiest families have successfully transferred their wealth across the ages, thanks to carefully devised strategies. However, In Africa, very few family businesses survive more than three generations.
Most family businesses struggle or go down the drain immediately the 2 nd generation takes over control due to lack of knowledge on managing and running huge multi-billion businesses. An estimated 70% of wealthy families lose their wealth by the second generation, and a stunning
90% by the third, according to the Williams Group wealth consultancy Whilst building a formidable business empire may take immense hardwork and a lifetime sacrifice, it only takes a year or two of poor management to bring the business to its knees. Wealth preservation and generational wealth transfer requires a clear, fixed, purposeful family governance structure that determines how the legacy is passed on.
The upcoming Africa private banking and wealth management Forum could build a discussion around to address the challenges present in the current wealth management landscape. The forum will be held on the 21 st and 22 nd of March at the Radisson Blu Hotel Nairobi Kenya.
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