All the Australian-owned banks posted above-par growth rates in their respective KiwiSaver schemes during the March quarter, new figures from research house Plan for Life (PFL) show.
According to the PFL report, the KiwiSaver market in total grew 4.5 per cent over the three-month period, rising from almost $32.4 billion as at end December 2015 to more than $33.8 billion by March 31 this year.
Of the big four banks, the National Australia Bank-owned BNZ KiwiSaver scheme recorded the highest quarterly growth rate of 9.3 per cent, albeit from a low base of $736 million as at the end of December.
While the late KiwiSaver entrant is making ground on rivals, BNZ’s closing March figure of $805 million funds under management (FUM) still represents less than 10 per cent of the amount managed by number one provider, ANZ.
Despite looking after almost $2.4 billion more in KiwiSaver than ASB – its nearest rival – ANZ recorded above average 5 per cent growth over the March quarter with FUM bursting through the $8 billion mark during the period.
ANZ’s KiwiSaver division generated the second-largest net flow across the bank’s entire Australasian funds management units in the six months to March 31, according to the latest accounts. Over the six-month period, ANZ KiwiSaver garnered net fund flows of A$472 million, bested only by the ANZ Australia’s low-cost super fund ‘Smart Choice’ which reported A$694 million in net flows. In total, the ANZ NZ funds unit recorded net flows of A$606 million during the half-year period compared to A$1.56 billion for the bank’s Australian funds management products.
The PFL figures show second-placed ASB reported KiwiSaver FUM of $5.98 billion at March 31 (up 4.9 per cent over the quarter) compared to the $8.3 billion total managed by ANZ across its three schemes.
The remaining Australian-headquartered bank, Westpac, also had a strong March quarter, growing 5 per cent over the period to hit almost $3.9 billion. Westpac KiwiSaver gained almost $60 million on AMP during the quarter, putting it about $100 million shy of overtaking the third-largest scheme.
The AMP scheme tipped above $4 billion over the quarter, the PFL figures show, with a growth rate of 3.3 per cent. Fisher Funds (3.8 per cent) and Grosvenor (4 per cent) reported below industry average growth rates while KiwiWealth was up just 1.3 per cent for the three months, the lowest by far of the top 10 players.
Meanwhile, Milford (4.8 per cent) had a solid, if unspectacular, quarter as the normally sluggish Mercer KiwiSaver scheme outperformed with a 5.1 per cent increase in FUM.
Outside the top 10 providers, the KiwiSaver market grew 5.3 per cent over the quarter with the remaining schemes measured by PFL amounting to $2.3 billion in total.
The Generate KiwiSaver scheme has been one of the fastest-growing schemes of the minnows, topping $200 million in the March quarter, according to chief, Henry Tongue, compared to $50.5 million the year previously.
Tongue said the membership increase of 11,580 since last June has been largely fueled by transfers from other schemes rather than new members.
He said 75 per cent of the member growth came from other schemes with new entrants dropping off considerably since the $1,000 ‘kickstart’ payment was axed last year.
“The biggest driver behind that growth is that we take the time and effort to provide advice to all members joining the scheme,” Tongue said.
He said just 17 per cent of Generate members were in conservative funds compared to the 45 per cent average across all KiwiSaver schemes.
According to Tongue, members have expressed high satisfaction with the “advice experience” in surveys carried out by Generate.
While Generate had one of the lowest average member balances of all schemes as at last March, Tongue said the statistic had improved.
“Our average balance is approximately $10,000 but actually over $11,000 once you take into account funds in transit,” he said. “The average balance transferring in is over $13,000.”
The PFL figures show the almost $1.5 billion increase in KiwiSaver total FUM in the March quarter was composed of $900 million in net flows and $560 million of investment earnings and external transfers.