Three largest advisers in UAE revealed: survey

From Middle East Oct 8 2012 BY: Mark Battersby , Editor , International Adviser
A total of 3,700 advisers are working in the UAE, which is a far bigger number than previously estimated and could imply that “the sector is over advised”, according to strategic consultancy Insight Discovery’s latest study.

In its third yearly Middle East Investment Panorama report, researchers identified 1,050 independent financial advisers, 650 private bankers from international and local banks, and around 2,000 advisers working for banks in the UAE.

The study also stated that the high number of advisers “adds weight to calls for increased regulatory approval and supervision of advisers.”

Breaking the headline figures down within the UAE, the three largest independent adviser firms were Nexus Insurance Brokers, with 280 advisers, de Vere’s 125 and Globaleye’s 80. Other large firms include Acuma, Holborn Assets, and Mondial, which all operate from Dubai.

Last year, around half of all advisers in the Gulf Cooperation Council (GCC) countries were dealing with international life offices last year and this year that percentage increased to 63%.

The purchase of funds through platforms has also increased at the expense of direct fund buying from the investment managers which is down from 40% of advisers last year to 29% now.

Nigel Sillitoe, chief executive of Insight Discovery, said: “The ‘open architecture’ model adopted by GCC financial advisers is a welcome sign for future growth as the industry matures and becomes more sophisticated. Such a model allows financial advisers to explore products and services from several external providers.”

Other key findings included:
· 60% of financial advisers prefer global emerging market equity funds, while the ‘hottest’ alternative asset classes are gold, commodities and listed real estate.
· GCC based financial advisers and retail investors are becoming increasingly ‘risk tolerant’ and optimistic despite various challenges like local and global economic volatility, regional regulatory uncertainties and the prevailing geopolitical situation.

· Big international asset managers are active in the region but there are still opportunities for new entrants from among the leading life companies.

· The potential for Takaful or Sharia compliant insurance remains underexploited, with fewer than half of financial advisers saying they see it as a major opportunity for life insurers.

Research for the Middle East Investment Panorama report was conducted in May and June, and consisted of online surveys, phone interviews and meetings.

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