Charity-focused fund house, Trust Management, has launched a new suite of portfolio investment entity (PIE) products that mirror its existing range.
Currently, Trust Management has about $450 million held through six group investment funds (GIF) – an older legal structure established as tax-effective vehicles for charities, trustee companies et al.
The Trust Management PIE funds go live on April 1 as the new tax year begins with a bulk GIF-shift likely to follow.
In addition to creating the new PIE structures, the company has amended the GIF trust deed to allow greater flexibility to wind up the funds, switch annual reporting dates from calendar year-end to March 31, and allow for in-specie distributions or bonus unit issuance.
Unlike PIEs, GIFs are tax-free for the manager, leaving the underlying investors responsible for paying tax at their respective marginal rates – which can be zero for charities.
Switching to a multi-rate PIE structure would enable Trust Management to continue to offer a zero-tax option for charities while also making its funds more attractive for other wholesale investors.
Trust Management operates five underlying funds covering property, Australasian shares, international shares, global bonds and NZ fixed income – all of which feed into another balanced fund. The firm manages property (about half overall group funds under management) and NZ bonds in-house while outsourcing global assets to State Street index products and Australasian shares to Harbour Asset Management.
Guardian Trust remains as supervisor and custodian on the PIE funds, reprising its roles in the GIF products, except for the Harbour Australasian shares fund that uses Trustees Executors for custody.
In March, former BT Funds NZ head of investment solutions, officially joined Trust Management
As reported here in January, Goldsack takes over as head of investment at the Auckland-headquartered organisation from the outgoing, John Williams.
It is understood Williams is retiring after a five-year stint at Trust Management.