Custodian business is extremely popular in Sweden with nearly 90% of Old Mutual International sales in the region using an external custodian. This stems from the preference of Swedish investors to use investment professionals to manage their portfolios or have their Bank continue to hold their assets.
The new Swedish Executive Portfolio also provides an opportunity for Swedish investors to use multiple custodians within the one life assurance contract. For example, investors can diversify their investments across multiple portfolios, without having to rely wholly on one investment professional. Using the new Portfolio bond, investors can select up to three different custodians. Under local Swedish tax rules this arrangement can be very beneficial as it allows the investor to transfer between investment managers without it being treated as a new premium and is therefore not subject to additional tax.
The Swedish Executive Portfolio is a whole of life, unit linked, life assurance policy. This makes it a simple, comprehensive and effective solution for tax-efficient wealth planning. It can help investors build their wealth from a wide range of assets, and offers flexible access to the investments, enabling investors to take regular or ad hoc withdrawals.
Being able to pass wealth on to the next generation is a key consideration for many investors. As the bond is designed specifically for Swedish investors, it can be used in unison with Swedish rules governing private property when nominating beneficiaries. This allows investors to ensure their children’s or grandchildren’s inheritance can be protected as their private property, known in Sweden as “Enskild Egendom”.
The new bond will produce a tax report annually, which will support advisers who often help their clients with their tax forms.
Marcel Bradshaw, sales director, Old Mutual International:
“The new Swedish Executive Portfolio is a great example of how we continue to develop tailored solutions to local clients based in our international markets. We have a long history in the Swedish market and we are committed to its future.
“Sweden is a market where the majority of business is managed by custodians, such as investment managers. This market leading proposition will enable clients to hold multiple investment managers within one life assurance contract, helping them to diversify the custodians looking after their wealth.”