Old Mutual International is targeting UK high net worth investors with the launch of a new offshore bond.
Dubbed the European Wealth Bond, its investments will be overseen by a discretionary fund manager (DFM) and according to Old Mutual International (OMI) it will therefore give investors access to a wider range of investment options – including direct equities – than is normally possible with more generic offshore bonds.
Initially the new bond will be managed by Quilter Cheviot, a UK-based discretionary management services provider acquired by Old Mutual in early 2015. However, Old Mutual said it intends to enable clients to take advantage of other DFMs in due course.
The launch of the new OMI bond comes at a time when life insurance companies are increasing their use of discretionary fund managers – and in some cases, like Old Mutual did, actually acquiring them. Experts say this is due in part to new regulations, such as RDR, which are causing advisers to shift their business models away from handling investment selection themselves to focusing more on the financial planning needs of their clients, and outsourcing the investment tasks to DFMs.
Steven Levin (pictured), chief executive of investment platforms at Old Mutual Wealth, said there has been “strong demand” from international advisers for more tailored products for their high net worth clients.
“Launching the European Wealth Bond is a key step towards delivering enhanced value to high net worth investors,” he said, adding that the product is a “great example” of how OMI is working with Quilter Cheviot.
Separately, OMI said it was looking to take advantage of the acquisition of Quilter Cheviot in other markets, in particular South Africa, where its parent, Old Mutual plc, was originally established in the 1800s.
Today Old Mutual is headquartered in the UK , has total assets under management of £319.4bn, and is a FTSE 100 listed company.