Sealcorp returns to its roots

It has been a tough couple of years for Sealcorp since being acquired by St George Bank back in December 1997. But with a new chief executive and a fresh team of senior executives, the group may yet find the wind that filled the sales of the highly successful master trust, financial planning and research conglomerate.

It has been a tough couple of years for Sealcorp since being acquired by St George Bank back in December 1997. But with a new chief executive and a fresh team of senior executives, the group may yet find the wind that filled the sales of the highly successful master trust, financial planning and research conglomerate.

Ian Knox is determined to make his mark on Sealcorp. He has spent his past six months taking a long, hard look at the group and now has a clear vision for the group’s next phase of development.

As Knox is well aware, Sealcorp had become one of the great success stories of the 1990s through being fleet of foot. Prior to being taken over by St George Bank two years ago, its senior executive team had a reputation as entrepreneurial yet with a solid grasp of the opportunities opening up at the cutting edge of the financial services industry.

“When Sealcorp started out more than ten years ago, it built a solid reputation of a group that was looking to the future,” he says.

Knox believes Sealcorp can recapture some the spirit that built the industry’s pre-eminent master trust, Asgard, and the pioneering managed funds research house, Assirt.

His strategy to achieve this vision is a mixture of embracing the strong identity of Sealcorp while at the same time realising the Sealcorp of today is a much different beast to that which started out in Perth more than ten years ago.

Knox took on the top job at Sealcorp six months ago at a difficult time for the group. His predecessor, Irene Lee, had departed after less than six months in the chair. Lee was the first managing director of Sealcorp since the group’s founder Graeme Morgan stepped down after selling his stake in the group to St George Bank in late 1997 for $272 million.

A string of other key executive followed in Morgan’s wake including Terry Wil-liams, Bruce Pellow, Phil Kelly, Cathy Duncan and just last month George Haramis.

But in their place have come some experienced players and slowly the executive team is building up a head of steam. In fact, one of the key pre-requisites for the top job was profile in the industry — something Ian Knox certainly is not short on.

At age 43, “Knoxy”, as he is known around the traps, has a CV that reads like a who’s who of the financial services industry. He has served tenures with Growth Equities Mutual in Perth in the late 1980s, MLC in the early 90s, Colonial and fi-nally Westpac Investment Management, where he was deputy managing director.

His basing in the retail financial services industry has meant that he understands the culture of Asgard and its place within the industry. That understanding has un-derpinned one of his key strategies.

“We are going to go back to our base roots,” he says. “The group has a strong reputation as having excellent ears - advisers and investors recognise Sealcorp as responsive.”

Knox recently fired out an edict to his senior management to wear down some shoe leather in an effort to stay in touch with their key constituents, financial planners. He has also opened up the phone lines of senior executives to loyal advisers and prying journalists.

“The road test for the group at the end of the day is people’s experience with senior staff,” he says.

A couple of months ago, Knox had the opportunity to put that responsiveness into practice. Senior management had decided to restructure the model choice option for the Asgard Master trust. As reported in Money Management back in June, a number of advisers voiced their concerns over the changes. The changes have sub-sequently been reversed.

But while responsiveness is important to Knox, he also understands that being re-sponsive can be a double-edged sword.

“The danger of being responsive is that you may lose leadership,” he says.

Leadership has been a very important part of the Sealcorp heritage, especially at the technology coal-face. Sealcorp realised very early on that technology was go-ing to be the lynchpin of the master trust and those who spent the dollars early would reap the benefits.

Asgard has certainly reaped the benefits from its ongoing commitments to IT spending. As the graph suggests, funds under management have grown 80 per cent in the past three years to $6 billion, almost $2 million clear of its nearest rival. And despite the internal ruptures, the master trust has continued to record inflows. In the three months to June 30, inflows were up 69 per cent to $377 million.

But being at the top of the heap is no place for complacency. Leadership also means innovation, according to the Knox doctrine.

To that end, Asgard has been developing two new concepts which it will be taking to the market over coming months.

The first is a service aimed at the burgeoning do it yourself superannuation market. With the help of financial planners, Asgard will provide self managed superannua-tion funds, as they are now called, to set up their all-important trust deeds and pro-vide ongoing back office through the master trust administration system.

Secondly, the group is offering what it calls “private labelling” of its master trust back office functions. This involves supplying the administration support for mas-ter trusts which are run by external financial services groups, particularly financial planning groups.

The group has been successfully working the concept with Hillross over a number of years and recently signed up Suncorp-Metway. Sealcorp is also currently in ne-gotiations with other groups looking to adopt the service.

Both of the new offerings fit in with the group’s strategy of being known as a wholesale administration service to financial advisers, according to Knox.

“We are striving to forge honest ongoing relationships with financial planners,” he says. “We don’t want to own the end client, that is the role of the financial plan-ner.”