Business Strategy

Our steadfast strategy has five pillars :

• To apply our resources to optimise our capital structure;
• To implement growth opportunities through acquisitions and collaboration and increase market share through client-centric solutions and service;
• To continue with our tight grip on costs;
• To persist with our transformation initiatives to build a world-class financial services group; and
• To explore opportunities for diversification through a wider range of financial solutions and geographic expansion.
  

Building solid safety barriers

The biggest risks for 2009 remain the volatile markets and the decline in the real economy, both locally as well as in the major developed markets. Our capital position, the returns we give to clients and our future business prospects are closely linked to what happens in global financial markets this year.

Although we believe that 2009 will be another tough year full of challenges, we are not changing our strategy – only the manner in which we are executing it. We have therefore taken a strategic decision to take our foot off the accelerator on the investment for growth side this year and to focus intensely on transforming Sanlam into an even more efficient and well-diversified operation.

Our diversification strategy is key to achieving this, but this year there will be greater focus on expanding and diversifying through strategic partnerships rather than through major acquisitions.

The aim is to further diversify our business not only through product ranges, but also into different market segments and countries. Specific initiatives will include:

• Diversifying further into the South African middle market with our Topaz offering from Sanlam Personal Finance. While this market is relatively mature, we are confident that we can grow our business by 10% per annum;
• Growing our business in the entry-level market by another 30% over the next two years by offering a wider product range, including short-term insurance products;
• Increasing our footprint in the mass affluent market by making available more relevant products and focusing on service as a differentiator. We achieved a 20% growth in this segment in 2008 and are confident that we can continue growing through our Glacier bySanlam offering;
  
• Expanding into the high net worth market through Sanlam Private Investments by adding credit products and access to private banking. Again, we are confident that we can achieve more than 10% growth in this segment this year;
• Taking our South African expertise to other African countries where we understand the language and the legal system. Our bancassurance initiative with one of the largest banks in Nigeria, falls into this space. This will be one of the few structural growth opportunities we will pursue in 2009;
• Focusing on bedding down our business interests in India and strengthening our distribution capacity there;
• Providing South African investors wanting to invest offshore with a more sophisticated UK offering. In addition, we will also strengthen our UK distribution capacity to enable us to expand our footprint there; and
• Being more diligent in our approach to the application of discretionary capital.