AMP Wealth NZ has officially pushed back the long-awaited investment shift to a BlackRock-managed passive strategy into the September quarter.
The change, which could see upwards of $10 billion move from keystone incumbent manager AMP Capital, was originally set down for the first half of this year.
However, in just-lodged disclosure documents, AMP says the date of the proposed transfer – due to hit the group’s KiwiSaver and superannuation master trust schemes, in particular – was now expected “in the third quarter of 2021”.
An AMP spokesperson confirmed the group was “on track to complete the transition by mid-July”.
Under the new timetable the switch to BlackRock comes almost nine months after the deal was first revealed in a shock announcement last October.
But, despite the delays, the change should still go ahead as per the most recent AMP disclosure document: “We have made the decision that AMP Capital Investors (New Zealand) Limited will no longer be the underlying fund manager for the majority of the AMP-named funds in the Scheme. We have decided to appoint BlackRock Investment Management (Australia) Limited to provide investment management services in relation to those funds, subject to certain conditions being met.”
In April, former AMP NZ head of intermediaries, Aaron Klee, stepped into the newly created head of investment management role ahead of the BlackRock reformation.
Behind the scenes, too, AMP Capital NZ has been preparing for the transition with changes to a number of products including the Income Generator range flagged in May this year. The restructure will see the Income Generator international bond exposure move from an AMP Capital wholesale multi-manager strategy to the passively managed Ethical Leaders Hedged Global Fixed Interest Index Fund.
“This will provide exposure to hedged global fixed interest while adopting a responsible investing philosophy through using an ESG style index,” AMP Capital NZ chief, Rebekah Swan, told investors in a note.
The existing underlying wholesale global bond fund was slated for closure this July “when a major client transfers out”, Swan says.
“The change of fund will be completed by mid-July.”
As at the end of March this year, the AMP NZ wealth business reported funds under management across its KiwiSaver and NZ Retirement Trust (NZRT) schemes totaling almost exactly $10 billion.
Figures from the EriksensGlobal quarterly master trust report show the NZRT at just above $3.5 billion at March 31 while the AMP KiwiSaver financial statements put the scheme at close to $6.5 billion on the same date.
During the 12 months to March 31 this year, the AMP KiwiSaver grew by just over $1 billion despite losing almost $300 million in net transfers to other schemes over the period.
Investment returns of almost $957 million accounted for almost all of the AMP KiwiSaver scheme growth over the financial year.
The financial statements also confirm the AMP KiwiSaver scheme stands to lose about $900 million in December following the default scheme changeover.
“Balances for default members who have not chosen their own funds (which were approximately $900m as at 31 March 2021) will be reallocated to Schemes who have been selected to be default KiwiSaver providers,” AMP notes in ‘events after balance date’.