In addition to launching New Zealand’s newest superannuation fund, Garrison Bridge, the Ralph Stewart-backed Lifetime group will takeover as manager of two super schemes offered under the IVCM brand.
Stewart said Lifetime had partnered with the £16.6 million (about NZ$28.5 million) IVCM scheme – previously known as Brooklands – to takeover management duties in readiness for the Financial Markets Conduct Act (FMC) December 1 deadline. Lifetime will act as the licensed entity for the IVCM PIE scheme as well as the recently-launched IVCM super fund (which is not structured as a portfolio investment entity).
According to the latest IVCM prospectus, the scheme was considering its options as the FMC cut-off date approached.
“We will work to ensure these new [FMC] requirements are met,” the IVCM document says. “However, there is a risk we will not achieve this and the scheme will be wound up, sold or your member account transferred to another scheme.”
At the same time, Stewart said plans were continuing apace for the Garrison Bridge scheme, which published its product disclosure documents last week. He said the UK pension transfer product was also registering with the Australian Securities and Investments Commission (ASIC) under the trans-Tasman Mutual Recognition regime.
The Garrison Bridge super scheme intends to apply for the qualifying registered overseas pension scheme (QROPS) status, which as at October 3 was yet to be notified by the UK tax department.
Excluding funds set up for individuals, the latest NZ QROPS list features just 16 providers, including the recently-renamed IVCM. The Australia QROPS list, numbering more than 320, is almost exclusively family-oriented schemes.
“There’s a lot of UK retirees moving to both Australia and New Zealand looking to transfer their pensions,” he said.
Stewart said Garrison Bridge also had natural synergies with his Lifetime Income annuity business, which after launching earlier this year has reached almost $10 million under management, as UK pensions eventually had to convert into retirement income streams. Lifetime was also close to inking a deal with a “major KiwiSaver provider”, he said.
According to the Garrison Bridge product disclosure statement (PDS), global consultancy firm Milliman has been appointed as investment manager for the scheme.
Milliman performs the same function for the asset management arm of Stewart’s annuity firm, the Retirement Income Group (RIG), which operates the Lifetime Income Fund.
Investment risk management specialist Milliman would advise Lifetime on the underlying funds including “whether or not to add or remove” managers, the PDS says.
“We also utilise investment research and other tools to provide recommendations on investment managers, where applicable,” the Garrison Bridge document says. “Milliman monitor and review the investment performance, investment options, compliance and contractual arrangements of the Underlying Investment Managers on a monthly basis and we monitor both Milliman and the Underlying Fund Managers performance on a quarterly basis.”
The Garrison Bridge scheme has two funds labeled Protector Plus – denominated in Australian and UK currencies respectively – that, while operated separately, “comprise a single trust fund”. As at inception, the scheme invests into a range of passive unlisted products and exchange-traded funds (ETFs) offered by BlackRock, State Street and Vanguard split about 50/50 between growth and income assets.
However, the funds have no explicit allocation to NZ assets aside from cash with equities spread among global funds as well as a specific Australian shares allocation (currently 11 per cent) for the Protector Plus AUD product.
Likewise, the scheme’s fixed income allocation is focused offshore split between broad global and regional (including Australia for the AUD fund) passive products.
Lifetime Asset Management and Christchurch-based financial planning firm, First Capital Financial Services, hold equal shares in Garrison Bridge Advisory Services, an entity established this June.
Stewart said the joint venture with First Capital Financial Services would assist in distributing the Garrison Bridge scheme.
Meanwhile, like IVCM, the almost $23 million Evergreen Retirement Trust (ERT) – which had its QROPS status suspended in 2012 – is also considering its post-FMC fate.
While the ERT scheme – run by directors Simon Swallow and James Murray – has received regulatory approval to transition under FMC as a restricted legacy scheme (not open to new members), the latest annual report says the manager and trustee were “considering the options to achieve the best outcome for the Scheme members”.
“No decision has been reached on the best course of action as at the date of signing the Annual Report,” the ERT document says.