The recent failure of African Bank is raising considerable concerns with investors. We have therefore asked our investment consultants to quantify the impact that recent events have had on the assets of OMEGS members. In general, investment managers employ diversification as a risk mitigation tool, so the investment portfolios available to OMEGS members all have limited exposure to African Bank investments.
The table below reflects the approximate impact on each of the investment portfolios offered by OMEGS. The figures are estimated, as they are based on the market value at 31 July. At this point, the exact loss cannot be known, but the figures below have been based on a conservative approach.
| Investment Portfolio | Total loss as % of portfolio |
| Old Mutual Absolute Smooth Growth | 0.05% |
| Old Mutual Absolute Secure Growth | 0.05% |
| OMIG Profile Balanced | 0.05% |
| OMIG Profile Pinnacle | 0.00% |
| Coronation Managed | 0.54% |
| Prudential Global Balanced | 0.12% |
| Old Mutual SA Money Market Pooled Portfolio | 0.00% |
| Albaraka Balanced Fund | 0.00% |
| OMIG Balanced Index Fund | 0.09% |
Let’s look at some examples:
- The majority of members are invested in the Old Mutual Absolute Smooth Growth Portfolio (the default option). However, because this portfolio uses smoothing, you will not notice any impact on your retirement savings at all (though the underlying assets will have experienced a very slight decrease in value of 0.05%).
- Another example: If you had R100,000 invested in the OMIG Profile Balanced portfolio, you would have lost approximately 0.05% X R100,000 = R50.
As you can see, the impact is VERY SMALL, and is comparable to the typical daily movements in the investment markets. Members therefore do not need to be concerned about this impact on their retirement savings!
