Nedbank Private Wealth – Nedbank Focus

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Nedbank WealthNedbank Private Wealth
Nedbank Group Limited (‘Nedbank Group’) is a bank holding company, with its principal banking subsidiary being Nedbank Limited. The company’s ordinary shares have been listed on the Johannesburg Stock Exchange since 1969.

Nedbank Group is South Africa’s fourth largest banking group measured by assets, with a strong deposit franchise, the second largest retail deposit base, a client-centric wholesale and retail franchise and a substantial and growing bancassurance and wealth management offering. The group offers a wide range of wholesale and retail banking services through five main business clusters, namely Nedbank Capital, Nedbank Corporate, Nedbank Business Banking, Nedbank Retail and Nedbank Wealth (the cluster in which Nedbank Private Wealth resides). Nedbank Group focuses on southern Africa, with the group positioned as a bank for all – from both a retail and a wholesale banking perspective.

Nedbank Focus combines banking and investment services, including the Nedbank Private Wealth discretionary investment management service, a financial adviser wealth management platform service and client execution-only investment dealing and settlement service into a seamless, cost-effective package which will save time and simplify administration for you and your clients.

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Investors Trust Summary

Nedbank Private Wealth – Review

Nedbank can be one of cheapest (ranked 3rd in charges without switches) to one of the most expensive if you actually trade with investments regularly (ranked 9th) As a basic platform for larger funds then it can be considered. However, if you start moving funds or currencies around then there are lot of other better platforms that should be considered. We like Nedbank overall for its banking and simplistic investment proposition, but would not use if to for active management.



For


  • Good for banking and non-trading investment accounts
  • Full flexibility with full withdrawal or full access in the early years without penalty
  • No commission, and no hidden charges
  • Full transparency of costs leads to lower charges than bond based options
  • No term required, therefore no surrender penalties (Beware any life bond wrapper )
  • Multi-currency options and low cost currency trades

Against


  • Poor for active trading
  • Expensive for active trading
  • Outside of a pension, many countries do not recognise any tax concessions
  • Expensive life wrapper option



Policy Currency:

Wide range of currency options with FX dealing facilities.

Banking services
Current account in 15 different global currencies, including Platinum Visa cards in GBP, USD & EUR (VISA cards not available if pension or insurance bond wrapped account)
Fixed term & structured deposit
Lending (subject to terms)
Foreign Exchange

Expat Money Expert Verdict on Funds 

Charges

Focus is designed for those with a minimum initial combination in cash and investments of £50,000, US$75,000 or €75,000, of which at least £5,000 (or currency equivalent) must be in cash. However, £7,500 minimum is offered for the collective discretionary managed funds.

Transaction charges 0.5% or £50 minimum and £100 maximum
Custody Charges £25 per transaction ( UK or US securities ) £40 per transaction ( all others )
Custodian Fee 0.25% pa (Many companies increase this. AES International publish this fee as being 0.35% for example)
Investment management fees on top.

Life Wrapper fees –
£150 pa
Annual Fees 0.375% pa
Termination fee 4% in yr1, reducing to 0% in yr. 4.

Funds
No restrictions- access to all major markets.
Investment services
• Financial adviser wealth management platform – wherein the financial adviser manages the money on behalf of the client
• Client execution only custody and nominee service
Discretionary managed portfolios available.
Can be used within life wrappers and provided their own life wrapper.

Documents

Nedbank Private Wealth Focus Brochure
Nedbank Private Wealth Terms and Conditions
Nedbank Private Wealth Focus Charges

Expat Money Expert Verdict on Charges if trading 

Expat Money Expert Verdict on Charges if not trading 

Pensions: The ability to wrap the Focus service within many structures including SIPPs, SSAS, QROPs, QNUPs, Trusts and Corporate Structures.
Surrender of Nedbank Focus: There are no surrender charges as there is no commission charged.

Expat Money Expert Verdict on Accessibility:



Expat Money Expert Assessment of the Nedbank Private Wealth

Nedbank offers full transparency with regards to charges and funds / equities / ETF from territories such as the UK, the USA and parts of Europe and in multiple currencies. For anyone wishing to invest in multiple currencies who wish to consider moving from country to country and have one custodian then this should be one of the options you look at.

The real issue is how it is set up and you are extremely reliant on your financial adviser dong the right thing. For example, some firms increase up –front establishment charges (we based our research on the published 0.25% annual custodian charge and no establishment charge) and increase the custodian charge without being open that they are doing it. Clients beware, as we have seen charges levied of up to 0.5% up-front and 0.35% annual custodian. Why pay the extra if you do not have to so negotiate, or go to another firm who will.

Nedbank can be one of cheapest (ranked 3rd in charges without switches) to one of the most expensive if you actually trade with investments regularly (ranked 9th) As a basic platform for larger funds then it can be considered. However, if you start moving funds or currencies around then there are lot of other better platforms that should be considered. We like Nedbank overall for its banking and simplistic investment proposition, but would not use if to for active management.

Funds can be selected with “clean” charges (the best) when directly compared to offshore bond offerings from fund houses via the UK or the USA. There are no charges on early access. You will get back the current value of your savings but, whilst there are no guarantees that the portfolio will give you the returns you are expecting, there are limited access penalties when funds in excess of published figures are taken; this loses it half a star.

NOTE: Nedbank Focus normally provides no commission to its distributors (in the industry this is called indemnified or up-front commission) and therefore a fee has to be paid, but some advisers charge high 4-5% fees whereas others will charge 2%. Also, additional charges may be applied to funds and custodian fees by some advisers, so choose your adviser carefully and do due diligence on the charges offered.

WARNING: Costs and information is correct as of November 2016. Information from AES International published on their website and also on their brochures sent out to clients. Please refer to a brochure from the company for current up to date information and any changes on costs or information. You should not buy based purely on information contained within this article and EME do not accept liability for purchases. If you have any doubts then please speak with your financial adviser or a representative of the company for further advice.

If the provider improves or amends its terms then EME would like to hear from them to amend the review page accordingly, and providers are encouraged to comment on errors or omissions to ensure that readers have the latest and correct information.




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  • Charges criteria

    Charges are assessed inclusive of fund fees, capital units, bid/offer spread criteria and third party management fees which are often ignored but are, in effect, compulsory additional costs that essentially must be considered by clients.


    Star ratings

    The star ratings apply at inception of the products and in at least the first 2 -8 years. Some products reduce charges or become more accessible with time held, but the length varies for each product; from our reviews it is typically overall between 5-10 years.

    These ratings are awarded based on information obtained from the companies at a certain date. It is worth considering obtaining the latest updated information yourself before making a decision.


    Star ratings

    ChargesOverall charges greater than 5% per annum.
    FundsLimited selected range of collectives or mirror funds with upfront additional charges (Bid/Offer spread) or initial “capital” units.
    AccessibilityTo avoid access penalties, only accessible after establishment period of 8 years or longer.
    Overall AssessmentA commission-based adviser’s product. Not recommended under any circumstances.

    ChargesOverall charges greater than 4% per annum.
    FundsIn-house range of collectives or mirror funds with upfront additional charges (Bid/Offer spread).
    AccessibilityPenalties resulting in loss of fund value may exist for 5 years – 8 years.
    Overall AssessmentA predominantly commission-based adviser’s product with limited use or appeal.

    ChargesOverall charges between 2.5% and 4% per annum.
    FundsIn-house or limited range of collectives or mirror funds with no Bid/Offer spread.
    AccessibilityTo avoid access penalties, only typically accessible after establishment period of 12-24 months or longer, but with no penalties thereafter.
    Overall AssessmentFor those seeking lock-in target dates (perhaps with guarantees) over 5 years.

    ChargesOverall charges less than 2.5% per annum.
    FundsFull range of collectives with no Bid/Offer spread and rebates on charges reducing annual costs.
    AccessibilityImmediate within 60 days without any penalties on any item.
    Overall AssessmentRecommended for some situations and some people due to lower charges and flexibility.

    ChargesOverall charges less than 1.5% per annum.
    FundsIncludes ETPs (passive) and Individualised accessible collectives with no Bid/Offer spread and clean share classes for lowest annual costs.
    AccessibilityImmediate within 30 days without any penalties on any item.
    Overall AssessmentRecommended for most situations and most people, with full transparency and low charges.