With ongoing fundamental regulatory changes preceded by an ongoing global pandemic, the advisory community in the Middle East has found itself (like many other regions across the world) in the eye of a perfect storm across the last 18 months or so.

Now, in the summer of 2021, as the pandemic begins to loosen its grip and the vaccination programmes begin kick in, International Investment's Gary Robinson spoke to Philip Story (pictured below), head of distribution, EMEA at Investors Trust from his Dubai base, about how the advisers in the region have adapted to change and how Investors Trust has been well-placed to support them during this difficult time.

This feature is part of the in-depth coverage covering adviser viewpoints, interviews and market insights in International Investment's latest Special Report on the Middle East 2021

GR: How are things going for Investors Trust in the Middle East at the moment?

PS: It has been very, very good. We've been very lucky over the last couple of years with the (established) online business, it really has helped. Being online for the last 15 years means it is nice and secure and it works so that really helps drive business as everyone has been locked down and stuck at home.

It has helped that we have just been able to carry doing what we do. Working that way alongside online meetings, you can do everything that you need to with online writing of the business as well, it helps enormously.

GR: So in many respects (in life offices years at least) has being set up as a relatively new company and having that tech side already in place has proven an advantage?

PS: It has. If you look at the different regions the approach around covid has been very different. If you look at the Middle East and UAE, the approach that each of the countries has taken it has been very different. UAE is very internationally-linked whether it is for business or for tourism it has been very forward thinking, really driving forward with the vaccine.

Being number one or number two in the world for he number of people vaccinated has helped the UAE to become even more of a hub than it was previously.

We know a number of advisers who have moved here as it is much easier to do business here. Particularly from Qatar, Lebanon etc. Lebanon has had other difficulties a well. But Oman and Bahrain have also struggled because they don't have the financial clout, of, say, a Saudi and UAE for job retention, so it has been difficult for them.

It creates challenges for some and opportunities for others. The good thing about our model is that to work with as many advisers in as many different locations as we can, you average out the ups and the downs and hopefully we can help more get through this period.

GR: How has the ‘traditional' UAE adviser coped with the pandemic? Especially on top of the with the regulatory changes from last year (ie BOD-49) really kicking in?

The big one was, of course, BOD-49 but there has been more recently with ESCA and the central banks re disclosures and transparency. These changes are coming in UAE and obviously in other regions as well. We work with advisers in Europe for example who have had the challenge of Brexit. And the adviser businesses there that were maybe passporting from the UK or vice versa, where those links have stopped.

There are two approaches to that those that were forward thinking that looked at this 2, 3 even 4 years ago and changed their business model so that renewal and trail income was built up and that secure income was coming in. Many were also building up their AUM as these models changed.

[But], some thought it might never happen as the Middle East has traditionally been very slow at change. But these things have happened and are happening more frequently. So those that stuck their head in the sand are not finding it is easy right now.

GR: This region that you (and your team) cover is across a very wide area - ie most of the world with Europe ME, India, Africa. How are things going with the team and the reasonably new office space? The last time I saw you in Dubai was at the end of 2019 and you were just getting settled in. But the pandemic followed soon after. So how are things settling now?

PS: It has been phenomenal. We moved to Central Park towers in the DIFC. It is right at the end of the DIFC so it is quite easy to get in and out of. We have a lot more space as well a nice board that, since the reopening, so it has been used quite a lot by some of he IFAs for meetings.

It is a nice space and has really nice views of the Burj Khalifer and the tech to hold meetings.

The team that started two years ago are all still there and we recently brought in a new addition recently to support the CIS brokers that we work with, so we continue to grow that area.

GR: Regarding the Middle East, what do you see a thew biggest challenge for this next year for Investors Trust And secondly, what is the biggest challenge for advisers in the region?

PS: That is a big question. For us, with the IT and the tech we have we are probably way ahead of others [at the moment]. But it also all about staying ahead.

Simplifying the processes to make it easier on the adviser, ie. going paperless etc. If you take up less of the adviser's time with these processes then you free up more time for them to see clients. It is a big challenge.

A lot of competition are now focussing more in that area and some may have deep pockets so we need to focus on what we are good at - having that 15 years experience on the IT front, being online, the security and the 24/7, 365 nature of our system.

The other challenge is keeping up with the growth. I was talking to our team about this the other day, about how many terms of business that we have set up with new adviser companies in the last 6-9 months. It has been a crazy hectic six months period getting everyone up to date and trained.

We have some brilliant new companies on board and we need to keep working hard to keep that growth we have had in H1 into H2 and beyond.

GR: And for advisers? What challenge does 2021 bring generally? Is it as simple a change the model or is it more complex?

PS: It is difficult [to generalise], as lots of advisers have different challenges. But overall, more generally speaking, it is adapting to regulation and the changes, making sure all licenses that they need to have are in place and also looking at the model they are going to work with.

In other places a lot of key advisers move up the food change into the HNWI space. Those that have focused on the smaller premiums [in the past] it will be more difficult. A lot of that might move online. Speaking to the protection companies, a lot more are moving online because it is easier to do it online.

So I think if you look at the business strategies a lot of advisers are trying to up-skill, with the CII and CISI training really focussing on the region here on those that move to HNWI clients, tax planning trust planning that HNWI clients need.

There is the up-skilling of the the advisers to that level and then retaining these advisers.

It is a big challenge for the advisers companies with advisers are moving around a lot at the moment, with the advisory company needed to retain those advisers and show them what value that they can offer them.

GR: Finally, what will the future of travel and meetings look like. What is new normal?

PS: Yes getting back to normal will be getting back to the new normal. I was in Cyprus the other week and I was one of the first that was able to get back to Cyprus from the Insurance companies.

Being able to see them online has really helped but those f2f relationships really do matter. To be able to have those conversations that you might not have online where you can have a coffee or a drink in the evening, these are really important.

These conversations can sometime bring up an unexpected new idea that really helps an adviser grow their business. Online you have more of agenda, so those F2F meeting are fantastic. They provides more feedback how we can support the advisers and hopefully we come up with more ideas for the future following these chats.

Will it mean I'll be traveling and flying around as much as I used to? Probably not, which is a shame as I love traveling. But fewer trips and more online is the new normal for us in 2021 and 2022.

I'm looking forward to more new trips in the coming months and setting those up to catch up with people and find way that we can really add value to the advisers and brokers that we work with.

GR: How are things going for Investors Trust in the Middle East at the moment?

PS: It has been very, very good. We developed a platform to work exclusively online years ago, so the transition to fully remote business was seamless and continues to keep us prepared for future uncertainties. Over the last 15 years, we have worked to create a fully functional and highly secure platform for business management which really helped drive business as everyone has been locked down and stuck at home.

It has helped that we have just been able to carry on doing what we do. Working that way alongside online meetings, you can do everything that you need to with online writing of the business as well, it helps enormously.

GR: So in many respects ITA (in life offices years at least) has being set up as a relatively new company and having that tech side already in place has proven an advantage?

PS: It has. If you look at the different regions within the EMEA, the approach around covid has been very different. If you look at the Middle East and UAE, the approach that each of the countries has taken has been unique and different from one another. UAE is very internationally linked, whether it is for business or for tourism, it has been forward thinking, especially with the vaccine rollout. Being number one or number two in the world for the number of people vaccinated has helped the UAE to become even more of a hub than it was previously.

We know a number of advisers who have moved here as it is much easier to do business here. Particularly from Qatar, Lebanon etc. Lebanon has had other difficulties a well. But Oman and Bahrain have also struggled because they do not have the financial clout, of say, a Saudi and UAE for job retention, so it has been difficult for them.

It creates challenges for some and opportunities for others. The good thing about our model is that we work with advisers in many different locations and, by doing this, you average out the ups and the downs while also helping more advisers get through this period.

 

GR: How has the ‘traditional' UAE adviser coped with the pandemic? Especially on top of the regulatory changes from last year (ie BOD-49) really kicking in?

PS: The big one was, of course, BOD-49. But, more recently, there have been new regulations from ESCA and the UAE Central Bank re disclosures and transparency. These regulatory changes are coming in UAE and obviously in other regions as well. We work with advisers in Europe, for example, who have had the challenge of Brexit. And the adviser businesses there that were previously passporting from the UK or vice versa, where those links have stopped.

There are two approaches to these changes - the more forward-thinking IFAs looked at this two, three or even four years ago and changed their business model so that renewal and trail income was built up and that secure income was coming in. Many were also building up their AUM as well.

[But], some thought it might never happen as the Middle East has traditionally been very slow with any change. But these things have happened and are happening more frequently, so those that stuck their head in the sand are not finding it as easy right now.

GR: This region that you (and your team) cover is across a very wide area - ie with Europe, Middle East, India, Africa. How are things going with the team and the reasonably new office space? The last time I saw you in Dubai was at the end of 2019 and you were just getting settled in. But the pandemic followed soon after. So how are things settling now?

PS: It has been phenomenal. We moved to Central Park towers in the DIFC. It is right at the end of the DIFC so it is quite easy to get in and out of. We have a lot more space as well, a nice boardroom that, since the reopening, has been used a lot by some of the IFAs for team meetings. It is a fabulous space and has really great views of the Burj Khalifa and all the tech you need to hold meetings.

The team that moved in two years ago with me are all still there and we recently brought on a new addition to support the CIS brokers that we work with, so we continue to grow that area.

GR: Regarding the Middle East, what do you see a the biggest challenge for the next year for Investors Trust, and what is the biggest challenge for advisers in the region?

PS: That is a big question. For us, with the IT and the tech we have, we are way ahead of our competitors [at the moment]. But it's also all about staying ahead.

Simplifying the processes to make it easier for the adviser, ie going even more paper free. If you take up less of the adviser's time with these processes, then you free up more time for them to see clients.

A lot of our competition are now focusing more on technology and some have deep pockets, so we need to focus on what we are good at - having that 15 years' experience on the IT front, being online, the security and the 24/7, 365 nature of our system.

The other challenge is keeping up with the growth. I was talking to our team about this the other day, about how many terms of business that we have set up with new adviser companies in the last six to nine months. It has been a crazy hectic period getting everyone up to speed and trained on our products and systems.

We have some brilliant new companies onboarded and we need to keep working hard to keep that growth we have had in H1 into H2 and beyond.

GR: And for advisers? What challenge does 2021 bring generally? Is it as simple a change to the model or is it more complex?

PS: It is difficult [to generalise], as lots of advisers have different challenges. But overall, it is adapting to regulation and the changes, making sure all licenses that they need to have are in place and also looking at the model they are going to work with.

A lot of our key advisers are aiming to move up the food change into the HNWI space. Those that have focused on the smaller premiums [in the past] will find this more difficult. For these smaller premium cases I believe that a lot of that might move direct online sales as it will not be profitable to provide a full wealth management service at lower premium levels. From what I hear, a lot of protection business is moving online because it is easier to do it online.

So, I think if you look at the IFA business strategies, a lot of advisers are trying to up-skill, with the CII and CISI training and qualifications, which is great news, and they are also really focussing on that move to HNWI clients, tax planning trust planning that HNWI clients need.

Another big challenge for the advisory companies at the moment appears to be with advisers moving around a lot at the moment, therefore advisory companies and having to fight to retain those advisers and show them what value that they can offer them.

GR: Finally, what will the future of travel and meetings look like. What is the new normal?

PS: Yes, getting back to normal will be getting back to the new normal. I was in Cyprus the other week and I was one of the first that was able to get back to Cyprus from the Insurance companies.

Being able to see them online has really helped tremendously but those F2F relationships really do matter. To be able to have those conversations that you might not have online, where you can have a coffee or a drink in the evening, these are really important for business development.

These conversations can sometimes bring up an unexpected new idea that helps an adviser grow their business. Online you have more of agenda, so these in-person, F2F meetings are fantastic at adding value. They provide more feedback on how we can support the advisers and hopefully we come up with more ideas for the future following these chats.

Will it mean I'll be traveling and flying around as much as I used to? Probably not, which is a shame as I love traveling. But fewer trips and more online is the new normal for us in 2021 and 2022.

I'm looking forward to more new trips in the coming months to catch up with people and find ways that we can really add value to the advisers and brokers that we work with.

To view this feature in the Middle East Special Report 2021, click here.