SUPERANNUATION – AUSTRALIA

Super funds $16b swoop on Ausgrid

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Original article by Angela Macdonald-Smith, Sarah Thompson, Anthony Macdonald, Geoff Winestock, Jenny Wiggins
The Australian Financial Review – Page: 1 & 12 : 21-Oct-16

The New South Wales Government’s deal to sell a 50.4 per cent stake in Ausgrid to AustralianSuper and IFM Investors without undertaking a competitive auction process may come under scrutiny. Some observers believe that the Government could have gained a better price for the electric power distributor if other interested parties had been allowed to bid. The Government opted to accept the unsolicited $A16.189bn offer from the two superannuation groups. The fact that they are both Australian companies was seen to be attractive, as the deal did not need to be approved by the Foreign Investment Review Board.

CORPORATES
AUSGRID PTY LTD, AUSTRALIANSUPER PTY LTD, IFM INVESTORS PTY LTD, NEW SOUTH WALES. THE TREASURY, NEW SOUTH WALES. DEPT OF PREMIER AND CABINET, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD, STATE GRID CORPORATION OF CHINA, CHEUNG KONG INFRASTRUCTURE HOLDINGS LIMITED, QIC LIMITED, HASTINGS FUNDS MANAGEMENT LIMITED, TRANSGRID, ENDEAVOUR ENERGY LIMITED, RBC CAPITAL MARKETS

Funds shun ASX in favour of cash, property

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Original article by Vanessa Desloires
The Australian Financial Review – Page: 27 : 19-Oct-16

Tim Baker of Deutsche Bank forecasts that Australian superannuation funds will receive some $A65bn worth of mandatory contributions in 2016-17. Discretionary contributions are expected to be around $A15bn, compared with the annual average of $A20bn. Meanwhile, Baker notes that super funds are scaling back their equity holdings and increasing their exposure to investment options such as cash, infrastructure assets and commercial property.

CORPORATES
DEUTSCHE BANK AG, AUSTRALIAN UNITY INVESTMENTS, UNISUPER LIMITED, AUSGRID PTY LTD, PORT OF MELBOURNE

Australians with industry superannuation funds are more satisfied than those with retail funds

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 14-Oct-16

A Roy Morgan Single Source survey has found that 59.7 per cent of Australians aged 14+ with an industry superannuation fund were satisfied with the financial performance of their fund in the six months to August 2016. This compares with 57 per cent of people with retail super funds. Members of industry funds have had a higher level of satisfaction than retail funds every month since 2007. The survey also shows that among people with a super balance of more than $A700,000, industry funds lead with 83.3 per cent satisfaction, compared with 80.5 per cent for retail funds. However, for those holding less than $A5,000 in superannuation, retail funds have marginally higher satisfaction than industry funds (48.0 per cent compared with 47.5 per cent).

CORPORATES
ROY MORGAN RESEARCH LIMITED

Government faces delay on ‘urgent’ cuts

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Original article by Phillip Coorey
The Australian Financial Review – Page: 5 : 30-Aug-16

The Australian Government will introduce 26 separate bills to Parliament in coming days, although its "omnibus" and superanuation reform bills will be delayed. The Australian Labor Party was not given a copy of the omnibus bill at its caucus meeting on 29 August 2016, while some Labor MPs oppose several of the proposed measures to reduce government spending. Meanwhile, the Government is yet to reach consensus within its own ranks regarding the lifetime cap on non-concessional super contributions.

CORPORATES
AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. PARLIAMENTARY BUDGET OFFICE, COUNCIL ON THE AGEING, AUSTRALIAN GREENS, AUSTRALIAN RENEWABLE ENERGY AGENCY, VICTORIA. COUNTRY FIRE AUTHORITY, UNITED FIREFIGHTERS’ UNION OF AUSTRALIA, AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSION, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET

SMSFs head for managed funds in volatile times

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Original article by Sally Patten
The Australian Financial Review – Page: 29 : 12-Aug-16

A survey by Investment Trends and Vanguard shows that 17 per cent of Australia’s self-managed superannuation funds expect to increase their exposure to managed funds in the next 12 months, compared with about 14 per cent in 2015. Meanwhile, the proportion of SMSF trustees who intend to invest in blue-chip stocks has fallen from 65 per cent to 55 per cent. There has also been a decline in investment expectations regarding exchanged traded funds and high-yield shares.

CORPORATES
INVESTMENT TRENDS PTY LTD, VANGUARD INVESTMENTS AUSTRALIA LIMITED

Lower rates help stocks but won’t spur growth

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Original article by David Rogers
The Australian – Page: 31 : 4-Aug-16

Australia’s S&P/ASX 200 gained 6.3 per cent in July 2016, but it has shed 2.2 per cent since the Reserve Bank reduced the cash rate to a record low on 2 August. However, equities are likely to benefit from a likely trend for self-managed superannuation funds to reduce their exposure to cash as returns from such investments fall. The outlook for interest rates in Australia and abroad is also likely to ensure that price-earnings ratios remain elevated for some time.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD, CREDIT SUISSE (AUSTRALIA) LIMITED

Super-size me: NAB banks on giant new fund

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Original article by Michael Bennet
The Australian – Page: 23 : 14-Jul-16

National Australia Bank’s MLC Super Fund has become the nation’s second-largest superannuation fund and the biggest retail fund after five separate funds were amalgamated. The enlarged MLC Super boasts some $A70bn worth of funds under management, and NAB has indicated that rationalising its super funds is likely to result in lower fees for members. The consolidation of its super funds will also enable NAB to separate its super and investment businesses from its life insurance arm, in which a controlling stake has been sold to Nippon Life.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED, NIPPON LIFE INSURANCE COMPANY LIMITED, AUSTRALIANSUPER PTY LTD

Retirees urged to tap into home equity

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Original article by Sally Rose
The Australian Financial Review – Page: 17 : 13-Jul-16

AustralianSuper CEO Ian Silk says the superannuation fund may seek to offer a broader range of retirement income products in coming years. This could include home equity release products, which allow homeowners to capitalise on the value of their home without the risks associated with reverse mortgages. Silk concedes that there are significant problems with some retirement income products that are currently available, and says the industry must work hard to address the issue.

CORPORATES
AUSTRALIANSUPER PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Satisfaction with performance of industry super funds increases their lead over retail funds

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 8-Jun-16

A Roy Morgan Single Source survey has found that 60.6 per cent of members of Australian industry superannuation funds were satisfied with their fund’s financial performance in the six months to April 2016. This compares with 56.9 per cent of members of retail super funds. Meanwhile, industry funds have increased their satisfaction level by 1.5 per cent over the last 12 month, while retail funds showed a small decline of 0.1 per cent. The survey also shows that satisfaction with super increases with the amount held, with both industry and retail funds scoring best among people with balances of more than $A700,000.

CORPORATES
ROY MORGAN RESEARCH LIMITED, CATHOLIC SUPERANNUATION AND RETIREMENT FUND, CONSTRUCTION AND BUILDING UNIONS’ SUPERANNUATION FUND, STATEWIDE SUPERANNUATION PTY LTD, AUSTRALIANSUPER PTY LTD, MOTOR TRADES ASSOCIATION OF AUSTRALIA SUPERANNUATION FUND PTY LTD, REST SUPER PTY LTD

Vanguard sees lower returns

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Original article by Sally Patten
The Australian Financial Review – Page: 8 : 11-Mar-16

Vanguard Group CEO and chairman Bill McNabb is bearish about the outlook for global investment returns over the next decade. He expects returns to be around two per cent below the long-term average over this period, although he anticipates a subsequent upturn. Meanwhile, McNabb says there should be greater transparency regarding Australian superannuation funds’, while he argues that consolidation in the industry could also be used to put downward pressure on fees.

CORPORATES
THE VANGUARD GROUP INCORPORATED