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FirstRand‚ Barclays and Liberty invest R30 million in partnership

On 29 January 2014‚ the University of Cape Town launched the African Institute of Financial Markets and Risk Management (AIFMRM) thanks to a multi-million rand partnership with FirstRand‚ Barclays Africa Group‚ Liberty and the Western Cape government. AIFMRM is an academic institute that conducts research and delivers education and training in financial markets and risk management.

The Dean of the Faculty of Commerce‚ Professor Don Ross said: "AIFMRM is unique in Africa. No similar academic institute‚ aimed at creating a steady and sustainable pipeline of African university graduates with sophisticated knowledge in banking‚ insurance‚ risk management and quantitative finance‚ exists on the continent."

"In the 21st century‚ capacity for situation-specific innovation in financial markets and risk management will be among the core determinants of which emerging markets graduate to mature development and which remain mired in middle-income traps."

"AIFMRM’s establishment improves the prognosis in this area. We owe this new basis for optimism to the forward-looking and expansive vision of our sponsors from the sector who have risen to the development challenge we face."

Founding director‚ Professor David Taylor added: "While our overall purpose is to increase the extent and depth of expertise and to address skills shortages‚ the Institute is specifically focussed on two key areas. One is transforming the profile of quantitative finance‚ risk management‚ insurance and banking professionals. The other is ensuring that the next generation of academics are in place to safeguard the continuity of graduates in these areas."

"Industry collaboration is the foundation of the activities of the Institute and is crucial to ensuring that education and research are aligned with the needs of the sector."

Founding sponsors of the institute are FirstRand Ltd‚ Barclays Africa Group‚ Liberty Holdings Ltd and the Western Cape Government’s Department of Economic Development & Tourism (DEDT).

Barclays Africa Group’s Chief Operating Officer Nic Swingler noted: "At Barclays Africa we understand the importance and impact of knowledge. When we work to develop the next generation of thought leaders‚ through rigorous research-based financial market and risk management discipline‚ we will all prosper. It is for these reasons that we support the Institute’s commitment to promoting diversity amongst Africa’s future finance and risk professionals. This is in keeping with our Citizenship philosophy and purpose‚ in that we seek to contribute to growth and help people achieve their ambitions in the right way."

Chief Risk Officer at FirstRand‚ Jaco Grobler welcomed the launch. He said: "Building a pipeline of scarce but critical skills is fundamental to the future sustainability of both the financial services industry and the economy as a whole. Currently the ongoing demand exceeds available skills‚ particularly in the risk management space‚ and FirstRand believes support for academic initiatives such as AIFMRM is a strategic imperative for its business and for the country."

Liberty’s Giles Heeger‚ CEO of LibFin‚ the business unit which manages the Liberty Group’s market‚ credit and liquidity risks said: "This is a collaborative initiative which will greatly improve the depth of scarce skills in the financial market sector‚ a field which is still a rapidly evolving science. Knowledge in action is at the centre of what Liberty stands to advocate in society. Its transformative power allows us to build a world where we can change realities for the better. Our aim is to see students complete their tertiary education with a well-rounded view of financial services and the practical tools to make a meaningful impact in this area."

The significance of the institute to the economy was recognised by the Western Cape Minister of Finance‚ Economic Development and Tourism‚ Alan Winde‚ who said: "As a country we have too many talented youth that are unemployed‚ that could positively contribute to the economic prosperity of our country. The vocational and academic innovation proposed by the institute will go a long way in addressing skills shortages in one of the fastest growing sectors. Furthermore‚ South Africa has positioned itself as a gateway into the rest of the continent. The additional focus on understanding African financial market idiosyncrasies will become a critical lever in positioning the region as the authoritative hub in African financial market intelligence."

The last word went to the Western Cape Premier‚ Helen Zille‚ who said: "Unemployment remains our most serious challenge in South Africa and indeed in much of the developing world. A critical factor underlying this challenge is often a mismatch between skills supply and demand. For this reason‚ all efforts to close the skills gap are most welcome in order to boost job creation‚ in particular because the skills base of an economy influences its attractiveness as an investment destination. Given the importance of the ICT and financial services sectors for the Western Cape economy‚ we are very pleased to be partners and full supporters of this collaborative effort between business‚ academia and government."

1. Sustainable staff plan

The institute will employ new‚ permanent academic staff with expertise in Quantitative Finance‚ Banking and Insurance Risk‚ Financial Regulation and Econometric Modelling. The initial members of the Institute will include a director‚ two professors‚ a teaching and research fellow and two support staff.

2. Partnerships

Partnerships are an integral part of the strategy of the Institute. The initial‚ and most important‚ relationship is with its corporate partners‚ FirstRand Ltd‚ Barclays Africa Group and Liberty Holdings Ltd‚ who will collaborate in shaping the Institute’s academic programmes.

The Institute has established further partnerships in pursuit of its goals. These include agreements with Georgia State University’s Department of Risk Management and Insurance and their Center for the Economic Analysis of Risk (CEAR)‚ the Association for Savings and Investments South Africa (ASISA) Academy‚ GetSmarter (an online education provider)‚ the Western Cape’s Department of Economic Development and Tourism (DEDT)‚ InSETA‚ BankSETA and the Banking Association of South Africa (BASA).

The Georgia State University collaboration will enable teaching contributions‚ course models and some shared supervision of postgraduate theses. The prospect of one or more co-taught and co-branded qualifications‚ involving student time at both institutions‚ is currently under discussion.

3. AIFMRM Qualifications

The Director of AIFMRM is the convenor of the MPhil in Mathematical Finance in the School of Management Studies. The MPhil is linked with AIFMRM and constitutes part of its suite of academic offerings.

AIFMRM is developing a further Master’s degree specialising in Financial Markets and Risk Management. It is also investigating the development of a Postgraduate Diploma in Financial Markets specialising in Risk Management. These areas were identified as critical skills deficits when the AIFMRM launch team conducted a commissioned Financial Services Sector Assessment in collaboration with the DEDT during 2013. An in-depth feasibility study is planned for 2014 to assess industry appetite and curriculum requirements in these areas and to investigate other skills needs.

Postgraduate research in Financial Markets and Risk Management will be conducted through AIFMRM.

4. About the Director‚ Professor David Taylor

Professor Taylor holds a PhD in Applied Mathematics from the University of the Witwatersrand. He led the Programme in Advanced Mathematics of Finance at Wits from 1996 to 2011‚ where he was instrumental in creating‚ funding and coordinating this programme. During this time‚ it became the canonical quantitative finance programme in South Africa and produced over 250 Honours‚ Master’s and PhD graduates in quantitative finance.

He is currently an Associate Professor in the Actuarial Science Section of the School of Management Studies at UCT. He convenes the MPhil in Mathematical Finance and is the director of the African Collaboration for Quantitative Finance and Risk Research (ACQuFRR)‚ AIFMRM’s research unit.

For further information‚ please contact:

Professor David Taylor

Faculty of Commerce
University of Cape Town
Email: David.Taylor@uct.ac.za
Phone: +27 21 650 5785

Posted by : Carolyn McGibbon

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