Sanlam has recorded solid expansion across the majority of its operations for the nine months to the end of September, buoyed by surging client cash inflows and resilient performances in insurance, investment management, and credit divisions. The financial services group reported a 19 per cent rise in net results from financial services on a normalised basis, with operational earnings climbing 16 per cent and new business volumes advancing 13 per cent, reflecting broad-based momentum despite pockets of strain.
Life insurance new business expanded by a more modest 6 per cent on a normalised measure, constrained by shifts in product preferences towards living annuities from guaranteed options and subdued group sales in the mass market segment. The value of new business margin held steady at 2.25 per cent, while favourable mortality trends provided a lift to profitability. Investment management benefited from elevated fee income driven by asset growth in retail and alternative strategies, whereas the credit and structuring arm saw expansion in South Africa and India, though elevated funding costs compressed net interest margins, as outlined in the group’s trading update released on Thursday, according to Sanlam.
Net client cash inflows almost doubled to R74 billion, underscoring strong investor confidence. Regionally, the Pan-Africa cluster delivered standout new business growth of 36 per cent on a normalised basis, propelled by bancassurance partnerships and individual life policies. Asia registered volume gains but faced headwinds from elevated development expenses. In South Africa, normalised new business volumes declined 10 per cent, largely attributable to the aforementioned product mix adjustments and softer corporate demand.
The group has progressed significantly with integrating recent acquisitions, including Assupol and Ninety One’s domestic asset management operations, completing eight of 11 planned mergers across its Pan-African footprint. These efforts, while contributing to short-term cost pressures alongside market volatility, position Sanlam for enhanced efficiency and scale. In a cautious move reflecting the uncertain economic climate, the board reduced the final dividend for the year ending December by 10 per cent.
Looking ahead, Sanlam expressed confidence in its prospects, highlighting supportive structural dynamics in core territories. Africa’s youthful demographics and expanding middle class, coupled with ongoing policy reforms in South Africa and sustained consumer spending in India, are expected to underpin sustained expansion. The company’s shares rose 0.62 per cent to R95.62 on the Johannesburg Stock Exchange following the announcement.
This performance aligns with broader trends in the South African life assurance sector, where assets under management surpassed R4 trillion in 2024, driven by recovering equity markets and increased savings post-pandemic. Industry consolidation has accelerated, with cross-border deals enhancing diversification and risk mitigation for large players like Sanlam, whose Pan-African strategy now spans over 30 countries, according to the Association for Savings and Investment South Africa (ASISA). The group’s focus on digital distribution and alternative investments further equips it to capitalise on evolving client needs in an increasingly competitive landscape.