SUPERANNUATION – AUSTRALIA

CBA faces first suit over low returns

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Original article by Michael Roddan
The Australian – Page: 21 : 11-Oct-18

The Commonwealth Bank of Australia has indicated that it will "vigorously" defend a class action launched by Slater & Gordon. The law firm contents that wealth manager Colonial First State had invested its superannuation clients’ money in CBA-owned funds that had very low returns, when it could have invested the money in higher-returning funds controlled by CBA or other banks. Other banks and financial institutions have also been targeted by class action lawyers in the wake of the financial services royal commission.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, COLONIAL FIRST STATE GROUP LIMITED, SLATER AND GORDON LIMITED – ASX SGH, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, COMMONWEALTH FINANCIAL PLANNING LIMITED, BW FINANCIAL ADVICE, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED, AMP LIMITED – ASX AMP, MAURICE BLACKBURN PTY LTD

Satisfaction with Industry Superannuation Funds lead Retail Funds at top end

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Original article by Roy Morgan
Market Research Update – Page: Online : 28-Sep-18

New results from Roy Morgan shows that in the six months to August 2018, satisfaction with the financial performance of industry superannuation funds was 71.5% for all balances over $100,000. This compares with a satisfaction rating of 63.0% for retail funds with balances of at least $100,000. Over the last 12 months, industry funds had an overall gain in satisfaction of 3.9% points, ahead of the 0.9% point improvement for retail funds. The biggest improvement for industry funds was in the $700,000+ segment, where satisfaction improved by 6.4% points. Retail funds only showed improved satisfaction for balances below $250,000 and declining satisfaction for higher balances, where 64.5% of the superannuation funds are held. These are the latest findings from Roy Morgan’s "Satisfaction with Financial Performance of Superannuation in Australia Report", which is based on in-depth interviews conducted face-to-face with over 50,000 consumers per annum in their homes, including over 30,000 with superannuation.

CORPORATES
ROY MORGAN LIMITED

TWU wants for-profit pirates out of super

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Original article by Joanna Mather
The Australian Financial Review – Page: 4 : 25-Sep-18

The Transport Workers’ Union’s national secretary Michael Kaine contends that banks and for-profit funds should be removed from the superannuation system. His views are a little more drastic than those of Industry Super Australia CEO Bernie Dean, who does not think that funds owned by banks should be barred from operating in the super system, despite evidence presented about them to the banking royal commission. Kaine is disappointed that ISA, which is a lobby group for industry super funds, has suspended its anti-bank "fox in the henhouse" advertising campaign.

CORPORATES
TRANSPORT WORKERS’ UNION, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN LABOR PARTY

Union funds call a truce

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Original article by Joanna Mather
The Australian Financial Review – Page: 1 & 4 : 24-Sep-18

Industry Super Australia CEO Bernie Dean says the lobby group has "shelved indefinitely" its anti-bank "fox and henhouse" advertisements. Dean, who has succeeded David Whiteley, was responsible for creating the commercials, which were launched in March 2017. AustralianSuper CEO Ian Silk had been queried by the banking royal commission as to why it had helped to finance what the commission described as political advertising. Silk stated that it was in the best interest of AustralianSuper’s members. Dean says this was a reasonable comment.

CORPORATES
INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIANSUPER PTY LTD, HOST-PLUS, ACTU, VICTORIAN WORKCOVER AUTHORITY, AUSTRALIA. PRODUCTIVITY COMMISSION

Supercharge economy, not giant vampire squid

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Original article by Terry McCrann
The Weekend Australian – Page: 38 : 1-Sep-18

When it was introduced in the early 1990s, it was hoped that compulsory superannuation would mean an end to people needing the old-aged pension. However, that ideal is no longer practical, due to a combination of low investment returns and the reduction of permanent and secure jobs. It has been suggested that it is now time to make Australia’s superannuation system a voluntary one instead. This would deliver a number of benefits, including an increase in real wages and a big jump in personal income tax revenues.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA. FUTURE FUND MANAGEMENT AGENCY

Change agent’s mission to restore trust in AMP

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Original article by James Eyers, Jessica Gardner
The Australian Financial Review – Page: 19 & 22 : 23-Aug-18

AMP’s incoming CEO Francesco De Ferrari will receive a base salary of $2.2m when he takes up the role in December, while his remuneration package also includes incentive payments. He faces a major challenge in turning around AMP’s fortunes in the wake of the banking royal commission’s revelations. De Ferrari is currently the head of Credit Suisse’s private bank in Singapore, and AMP chairman David Murray has praised the corporate culture at Credit Suisse. Shares in AMP closed $0.06 lower at $3.39 on 22 August, after the stock began trading ex-dividend.

CORPORATES
AMP LIMITED – ASX AMP, CREDIT SUISSE AG, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, CREDIT SUISSE (AUSTRALIA) LIMITED, MORGAN STANLEY AUSTRALIA LIMITED, BT FINANCIAL GROUP PTY LTD, WESTPAC BANKING CORPORATION – ASX WBC, MACQUARIE GROUP LIMITED – ASX MQG

NAB charges double on super

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Original article by Elizabeth Redman
The Australian – Page: 17 & 20 : 20-Aug-18

The banking royal commission has spent the last two weeks grilling the superannuation sector over its fees and practices. Companies under the commission’s microscope have included National Australia Bank, with Australian Securities & Investments Commission deputy chairman Peter Kels stating that it planned to submit a brief to the Director of Public Prosecutions in regard to NAB’s "fee for no service" scandal. Meanwhile, it has been revealed that NAB unit MLC charges members of at least 10 super funds up to double the fees that are imposed by the fund’s external managers.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, MLC LIMITED, THE VANGUARD GROUP INCORPORATED, MACQUARIE GROUP LIMITED – ASX MQG, PERPETUAL LIMITED – ASX PPT, PACIFIC INVESTMENT MANAGEMENT COMPANY LLC

NAB’s fee strategy in spotlight

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Original article by Joanna Mather
The Australian Financial Review – Page: 8 : 7-Aug-18

The banking royal commission has been told that National Australia Bank retained "grandfathered" commissions after merging five separate superannuation funds in 2016. A former NAB executive, Paul Carter, told the inquiry that the bank had been concerned about the impact that abolishing the commissions would have on revenue, as financial planners could potentially have responded to the move by directing clients to other products. The inquiry was also told that NAB failed to inform clients that they could opt out of paying a "plan service fee".

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED, MLC MASTERKEY, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, NULIS

Super funds face heat over other expenses

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Original article by Joanna Mather
The Australian Financial Review – Page: 1 & 4 : 25-Jul-18

The classification of superannuation funds’ expenses in the category of "other" has come under scrutiny in a background paper issued by the banking royal commission. About 20 per cent of industry super funds’ expenses are categorised as "other", compared with around 10 per cent of retail funds’ expenses. The background paper also notes that many people who switch super funds in search of lower fees and higher returns often end up with higher fees and lower returns. Superannuation will be a focus of the inquiry’s next round of public hearings, which begin on 6 August.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIA. PRODUCTIVITY COMMISSION, RICE WARNER ACTUARIES PTY LTD

Hayne to probe industry super funds over union sponsorships

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Original article by Michael Roddan
The Australian – Page: 17 & 21 : 20-Jul-18

The superannuation industry will be a key focus of the banking royal commission’s next round of hearings, which will commence on 6 August. AustralianSuper, Hostplus and Cbus are believed to be among the industry super funds that have been asked to provide the inquiry with information on their sponsorship arrangements with unions. However, the inquiry is not believed to have requested similar information regarding such deals with employers’ groups.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIANSUPER PTY LTD, HOST-PLUS, CONSTRUCTION AND BUILDING UNIONS’ SUPERANNUATION FUND, HEALTH EMPLOYEES’ SUPERANNUATION TRUST AUSTRALIA LIMITED, AMP LIMITED – ASX AMP, WESTPAC BANKING CORPORATION – ASX WBC, THE NEW DAILY, INDUSTRY SUPER HOLDINGS PTY LTD, ME BANK, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, MASTER BUILDERS AUSTRALIA INCORPORATED, ACTU, CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION OF AUSTRALIA