Our client was the third largest bank by assets in the United Arab Emirates until it merged with another bank to form the largest bank by assets in the UAE. It operated from over 25 branches offering Retail, Corporate, WM, Treasury and Trade Finance Operations. In the case of this project, the client had requested Cedar to assess potential partnerships with Individual Financial Advisors (IFA) to maximize their outreach and widen the distribution of wealth management product offerings.
In this program, Cedar was mandated to conduct a market & competitive assessment and assess the feasibility to setup a partnership model with IFAs in the UAE.
- Assessed the current state of IFA model in the UAE covering product opportunities and pricing models, conducting over 17 primary interviews across institutions.
- Determined competitive positioning and market share of key IFAs in the market and conducted a competitive profile of 3-4 players across focus areas.
- Analysed global and market trends to gauge best practices and conducted a feasibility study for the client to establish IFA partnerships.
- Identified typical products and activities to be handled by IFAs and assessed typical pricing considerations and the revenue sharing model.
- Reviewed the regulatory framework, risk and financial considerations required for an IFA partnership.
The program resulted in Cedar recommending a potential partnership with a medium to large sized IFA via the equity participation model.
- Suggested a higher opportunity to target IFA’s that are primarily insurance firms but also have investments on offer.
- Designed a partner-selection framework to identify top 15 IFAs.
- Recommended a small-medium sized firm with a local presence and reasonable customer base for cross sell, and a firm able to withstand capital and staff regulations.
- Suggested an equity participation model due to its feasibility and alignment to the client’s objectives and due to the higher outreach, it would ensure by tapping into the IFA’s existing customers.
- Identified the advantage of IFA as being able to leverage offshore insurance expertise having a network of customers and insurers.
- Ensured alignment as the client sold various lending, leveraged, investment and structured products to insurance customers.