JOHANNESBURG, June 11 (Reuters) - South African bank FirstRand said on Tuesday it has launched an asset manager, the latest entrant into the already crowded investment market of Africa's top economy.
Banks around the world are increasing their focus on fee-generating asset and wealth management businesses as tougher regulations put pressure on core lending operations.
FirstRand, South Africa's second-largest bank, has been without an asset manager since spinning off its Momentum insurance unit in 2010. But it is likely to face stiff competition from other established players such as Investec and Old Mutual .
"The idea is also to continue to increase our non-interest revenue and fee income from this business," FirstRand Chief Executive Sizwe Nxasana said.
The new unit, Ashburton Investments, already has more than 110 billion rand ($10.81 billion) in assets under management, Nxasana said, adding the bank aimed to become a "meaningful participant" in the market.
Ashburton will give investors access to some non-traditional instruments, said Boshoff Grobler, who heads the business.
"We're moving into the unlisted space," he said. "We will provide local investors with access to credit assets that have traditionally sat on the bank's balance sheets in investable format."
Ashburton will also offer exposure to real estate and hedge funds, he said.