New Zealand’s only Māori-controlled KiwiSaver scheme has officially handed in its keys after failing to make scale prior to the Financial Markets Conduct Act (FMC) December deadline.
As reported by Investment News NZ (IN NZ) this April, closure was on the cards for the tiny IwiInvestor scheme – a subsidiary of the Taupo Moana Group – as it, along with several other minnows, faced major FMC transition expenses.
While it is understood a group of buyers associated with a stockbroking firm were running a ruler over the scheme earlier this year, IwiInvestor confirmed on its website late last month it would fold on August 1.
“IWIinvestor has not been able to attract a sufficient number of members in time to make it viable to continue as an operating Kiwisaver Scheme,” the website says. “This is unfortunate as the Scheme is fully compliant and it has always been the goal to grow as the only Māori owned and operated Scheme in New Zealand.”
According to its latest regulatory disclosures, IwiInvestor reported just over $2 million under management – outsourced chiefly to NZ fund managers Mint and Nikko – on behalf of about 240 members.
As at June 22 all IwiInvestor accounts were frozen pending determination of the final unit prices, expected before August 1.
IwiInvestor, included in the Taupo Moana IwiSaver accounts, was put on notice in 2015 after its parent group committed funds up to $2 million to support the scheme for at least 12 months from November last year.
“The Board of Directors recognises that the company has net liabilities of $580,999 and has made a loss in the year of $328,483 and that this is not sustainable,” the 2015 annual financial report says. “The Directors recognise that there needs to be a change in the business to move it towards a profit making position and the Board is taking steps to ensure this occurs.”
IwiInvestor’s non-KiwiSaver funds management, financial advice and insurance businesses continue to operate with Richard Jefferies, as CEO.
However, in May this year IwiInvestor Group Holdings was registered as a new company with the ultimate holding entity, Whenuabank Ltd, listing Tim Fitzgerald as the sole shareholder. Fitzgerald is a director, or former director, of almost 80 entities, including some in the Taupo Moana stable.
Launched in 2011, IwiInvestor joins the rapidly filling-up KiwiSaver graveyard. From a peak of more than 40 schemes the post-FMC KiwiSaver scheme headcount will likely sink to less than 30.