If the future of fund management lies in global rather national strategies then Skandia Investment Group has picked the right man. New chief executive Nils Bolmstrand is a Swede who studied in Spain and has worked in European, Asian, South African, Latin American and British markets.
Bolmstrand took the helm at SIG in September, replacing Jamie Macleod, having worked at SIG since its inception in 2007. He feels his stamp on the firm is already there.
“I have very much been part of building SIG up to what it is today. Right now, the goal for me is making sure we have focus and making sure we deliver on our promises. I want to develop this into an even more successful investment management house.”
Bolmstrand trained as a lawyer, specialising in EU financial law, but soon found the consultation style of law lacked some of the challenges he was looking for. He says he found what he was looking for with Skandia, which he joined in 1998. He has worked through the group and throughout Europe, becoming well versed in international management and research.
Before taking the reins, Bolmstrand was chief commercial director at the firm which allowed him to use his international relationship management skills. He thinks the use of multinational and multicontinental strategies is going to be crucial in the development of the fund management sector and IFA investment businesses over the coming years.
“We operate all over the globe – Asia, South Africa, Continental Europe and Latin America. How does this add value to the UK IFA’s business?
hrough us being able to look throughout the world and find best practice and bringing that to the local market. That might be UK managers being brought into the Nordic market or it might be Nordic or Asian managers being brought into the UK – international perspective is key.”
For Bolmstrand, the UK fund management sector is a leading light in the global market and, as a result, UK managers are being moved to other parts of the world by SIG to create a balanced offering from the firm.
“The UK market is very advanced and we are currently exporting a lot of managers and ideas out of the UK. We want our managers to take risks and we want to deliver outcomes and our way to do this is to blend managers. We need to mix them right to be sure of the outcomes.”
This process also works in reverse and SIG is as keen to bring in foreign managers to the UK. “We canvass the world for really interesting investment managers. Many of them will be investment managers who might not be known in the market where we are operating but our scale gives us access to them. To blend and package those types of managers gives us a cutting edge.”
The firm is also bringing new ideas and products into the UK to help solve the current problems facing the economy. “Old Mutual in South Africa is a big player and the way that they work with guaranteed products, for example, is something of interest to us. We are looking at what we could bring to the UK market in forms of guarantees and alternatives to guarantees that currently exist in the UK market.
“I don’t think anyone has found a solution that is easy to understand for the UK client, both on the downside and the upside, in understanding their risks while giving them a true guaranteed protection within the right product.”
Bolmstrand says the retail distribution review and its demands for transparency will also help strike a balance between risk and reward for investors.
“Without a doubt, it is more important than ever for IFAs to help explain the balances of risk and reward. For us too, we should never lose sight of the fact that we are the manager and custodian of people’s money that they intend to pay their rent with when they grow old. So it is absolutely one of the responsibilities that the client understands what they have invested in and they understand the possible outcomes.
“This is why I welcome the RDR change, it should be clear to the client what they are buying, it should be clear why they are buying it and if they are buying it through an IFA it must be truly independent.”
Bolmstrand does admit the RDR will bring challenges as well as rewards and says consolidation in the IFA sector could mean more people miss out on financial advice.
“IFAs cannot lose sight of the fact that consolidation may mean the less financed clients are lost as firms get bigger and aim higher. But this is an opportunity for them and us as much as it is a challenge in how we all create a cost-effective and innovative way of catering to the mass market. Technology development and creating automated ways of capturing business is key to that.”
That is not to say that the changes will mean IFAs lose their status in the UK and the country moves to a more bancassurer-based model like that of some EU countries.
“The IFA model is ingrained into UK culture and it works because it breeds competition in the market. It would be good if more EU nations moved more towards the UK structure of advice.
“IFAs have seen a number of changes over the years and have maintained the trust and confidence of their clients for a long time, I don’t think that is going to change after the RDR.
“Clients will turn to their IFA for advice and that advice will not change that much. They have shown that they have acted with integrity so far and they will continue to do that.”
Born: Lund, Sweden 1972
Education: Law, University of Lund, Sweden
Drives: Being a Swede, a Volvo
Book: The Immigrants by Vilhelm Moburg – a Swedish classic
Film: Anything by Ingmar Bergman or starring Bruce Willis
Album: The music of Gustav Holst – English-born, Swedish temperament
Career ambition: To ensure SIG becomes one of the best-known asset managers in the industry
Life ambition: To achieve my career ambition and to take my colleagues with me
If I wasn’t doing this I would…Look for similar challenges elsewhere. I have a great job.