Standard Bank plans to start a prime brokerage next month to benefit from regulatory changes in South Africa it expects will boost the hedge fund industry. The bank anticipates having five hedge-fund clients by the end of the year.
Standard Bank is counting on using its estimated 60 percent share of the South African securities lending market to bolster the prime brokerage even as lenders including Credit Suisse Group retreat from the business globally because of profitability concerns.
Standard Bank has been testing the service with “friendly clients” for the past few months after hiring two new executives to lead it, Andrew Cairns and Francois Henrion, who was previously at Barclays Africa’s prime-services unit. The business plugged into the global market team’s existing infrastructure that also does derivatives clearance, research, custodian business and broking execution.