Major Fund Manager Issues a Warning About South Africa
Coronation, one of South Africa’s largest asset managers, has warned that the country’s savings industry is deteriorating, reflecting deeper economic pressures affecting households and investors.
Savings industry under strain
In results for the year ending 30 September 2025, Coronation said the long-term contraction in the local savings market continued, driven by:
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financially stretched consumers,
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rising unemployment, and
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the launch of the Two-Pot Retirement System, which allowed more South Africans to withdraw retirement savings to meet immediate needs.
Although Coronation’s net outflows improved to 5% of average AUM, the company remains heavily exposed to the industry’s structural decline and does not expect a rapid recovery.
Global and domestic uncertainty adding pressure
The asset manager highlighted several major external risks that weighed on markets:
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The new US administration (January 2025) triggered uncertainty around trade tariffs and geopolitical shifts.
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Rapid advances in artificial intelligence have disrupted markets and valuation models.
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Delays in South Africa’s 2025 National Budget approval created further local market volatility.
Despite this, Coronation said most of its funds delivered strong market-beating performance, helping lift total AUM by 14% to R761 billion.
Financial performance
Coronation reported mixed results for the year:
Positive operational momentum
But profit sharply down due to higher taxes
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Profit for the year: R1.6 billion (down 24%)
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Basic & headline EPS: 474.3c (down 25%)
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Total dividends per share: 454c (down 20%)
Coronation attributed the decline primarily to a much higher tax charge during the period.
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