As the transition deadline for Financial Markets Conduct Act (FMC) compliance looms closer, employer-based super funds are increasingly looking for outsourced solutions, according to Therese Singleton, AMP NZ head of investments and insurance.
Singleton said the number of super fund requests for proposal (RFPs) has ratcheted up since this June as trustees prepare for FMC implementation next year.
“We’re actively in discussion with trustees of standalone schemes and are targeting a number of schemes over the next 12-18 months,” she said.
Employer super funds, and most other FMC-policed entities, have until December 2016 to comply with the new regime, which in most cases will result in expensive and complex restructuring.
Currently, about 150 employer superannuation schemes are registered with the Financial Markets Authority but that number is expected to drop significantly under the FMC, as many funds either close or roll into master trusts.
“The Financial Markets Conduct Act is proving to be a catalyst for significant change in the wealth management industry and it is creating a number of opportunities for our business,” she said.
Singleton said AMP’s New Zealand Retirement Trust (NZRT) was set to benefit from scheme rollovers.
The NZRT has already seen an uptick in flows with funds under management currently about $2.5 billion, up almost $700 million since June last year. As at June 2014, the NZRT balance stood at $1.76 billion compared to $1.62 billion in the previous year – equating to an increase of just $140 million over the 12-month period.
In addition to the NZRT, a handful of other providers remain in the superannuation master trust space including ASB, the NZX-owned SuperLife, Mercer, Aon and Fisher Funds. According to the June 2015 survey published by actuarial consulting firm, Eriksen & Associates, total super master trust funds under management stood at about $5.7 billion, compared to $5 billion the previous June.
AMP is also about to launch a retirement savings app targeting its KiwiSaver and NZRT members.
According to an AMP spokesperson, the ‘My AMP’ app will allow its KiwiSaver and NZRT members to view their balances on mobile devices.
“Along with balance and transaction information, the app will feature an investment overview showing how the customer’s retirement savings are split between funds,” the spokesperson said. “In the first release, some customers will also be able to access details of their life insurance cover with plans to extend the range of products featured in later releases of the app.”
The app will also include contact details of the members’ AMP financial adviser, if applicable, or the group’s general adviser team.