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Offshore investment row: Asisa didn't consult properly says Magda Wierzycka

26 November 2020 8:51 PM
Tags:
National Treasury
South African Reserve Bank
Sarb
The Money Show
Bruce Whitfield
Exchange controls
Sygnia
Magda Wierzycka
Offshore investments
Asisa
Financial Sector Conduct Authority
FSCA
Pension Funds Act
Association for Savings and Investment South Africa
Leon Campher
Regulation 28
foreign assets

Bruce Whitfield interviews Wierzycka (Sygnia CEO) and Asisa's Leon Campher after Treasury's u-turn on pension fund investments.

There's another row brewing between the Association for Savings and Investment SA (Asisa) and the outspoken CEO of Sygnia, Magda Wierzycka.

It once again includes Regulation 28 of the Pension Funds Act, which aims to safeguard clients' retirement savings through responsible fund management.

RELATED: Prescribed assets: Magda Wierzycka (CEO, Sygnia) accuses IRR of bullying her

RELATED: Prescribing assets: IRR is 'stirring up panic' about ANC accessing pensions

Since the tabling of the Medium-Term Budget Policy Statement (MTBPS) in October, National Treasury has apparently done a u-turn on allowing a higher ratio of offshore investments for pension funds.

Wierzycka says this is a result of Asisa members demanding the suspension of Treasury's circular.

Asisa issued a media release on Thursday in which CEO Leon Campher states that the association's always supported exchange control relaxation.

The SARB circular was positive in that it removed the inconsistent treatment of inward listed instruments depending on whether they were equity, debt, ETFs or derivatives. However, pension funds are still required to comply with prudential requirements applicable to their investments, namely Regulation 28.

Leon Campher, CEO - Association for Savings and Investment SA

Campher says Asisa engaged with the Financial Sector Conduct Authority (FSCA) simply to gain clarity on behalf of member companies.

But the contentious circular was clear, insists Wierzycka.

"It basically reclassified all ETFs (exchange traded funds) which are linked to foreign assets."

Bruce Whitfield interviews both Wierzycka and Campher on The Money Show.

It reclassified it from being a foreign asset to being a domestic asset and it further stated that the following categories of investors could now invest in these instruments without restriction.

Magda Wierzycka, CEO - Sygnia Limited

It suddenly opened the potential for savers to earn some real returns.

Magda Wierzycka, CEO - Sygnia Limited

We didn't as Sygnia try and interpret the circular - we went to the top pensions fund lawyer in South Africa... and we got a very comprehensive legal opinion of how it worked in combination with existing Regulation 28.

Magda Wierzycka, CEO - Sygnia Limited

According to Wierzycka, the withdrawal of the circular was as a direct result of lobbying by large asset managers through Asisa.

The association should consult with its members, of whom Sygnia is one, she says.

But just "a few" members got together to write the letter to the FSCA.

Campher says it wasn't only individual asset managers that approached Asisa.

It's not just about Regulation 28. It's about life office assets, CIS assets...

Leon Campher, CEO - Association for Savings and Investment SA

They don't believe that the intention was from the circular that you're now able to externalize 100% of the assets... They were saying it's responsible before we launch product to actually get clarity...

Leon Campher, CEO - Association for Savings and Investment SA

Are local asset managers panicking about an implosion of the JSE? asks Whitfield.

Campher says emphatically: "There is no conspiracy here."

Listen to Wierzycka's argument in detail below:

Listen to Campher's argument here:


This article first appeared on 702 : Offshore investment row: Asisa didn't consult properly says Magda Wierzycka


26 November 2020 8:51 PM
Tags:
National Treasury
South African Reserve Bank
Sarb
The Money Show
Bruce Whitfield
Exchange controls
Sygnia
Magda Wierzycka
Offshore investments
Asisa
Financial Sector Conduct Authority
FSCA
Pension Funds Act
Association for Savings and Investment South Africa
Leon Campher
Regulation 28
foreign assets

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