The Kiwi Wealth brand is set to retire early next year along with outgoing Fisher Funds chief, Bruce McLachlan, ahead of a long tail of product rationalisation.
McLachlan will hand over the reins of Fisher Funds to Simon Power next February after almost wrapping up the final main details of the Kiwi Wealth merger, the last and probably biggest task in his seven-year career at the now $23 billion investment house.
“I would’ve liked to have stayed around until the Kiwi Wealth integration was completed,” he said. “But you can never time the end date perfectly.”
According to McLachlan, most of the key merger components will be in place by June this year but other pieces of the Fisher/Kiwi Wealth jigsaw may not be in place for years.
Most of the time-consuming integration works will revolve around product and technology decisions, he said.
“But it’s self-evident we can’t run three KiwiSaver schemes and two sets of retail funds.” McLachlan said.
Fisher, of course, has a long history of merging KiwiSaver products (and others) with acquisitions including the-then First NZ Capital scheme in 2010 followed by Huljich, for $21 million, the following year, and Aon (costing about $31 million) in 2021. The group paid a further $79 million to buy Tower in 2013 but kept its KiwiSaver scheme as a stand-alone entity, rebranded as Fisher Two – albeit later aligning the back-office services with its existing scheme.
However, the $310 million Kiwi Wealth purchase is the largest (circa $7 billion of assets) and likely most complex re-wiring job Fisher has attempted to date.
Fisher has already cleared out most of the Kiwi Wealth investment and executive teams, retaining a few portfolio managers, and combined some underlying fund strategies.
The group also appointed JB Were as sole custodian for the Kiwi Wealth funds, removing BNP Paribas from its previous shared back-office duties.
A full integration of Kiwi Wealth and Fisher, though, would likely see further big behind-the-scenes changes. Fisher, for example, uses Trustees Executors for custody, administration and as supervisor while Kiwi Wealth recently appointed Apex (formerly MMC) as fund administrator with Public Trust incumbent supervisor.
Some of those decisions will likely fall under Power’s watch but McLachlan may be around to see out the Kiwi Wealth brand.
“We had use of the Kiwi Wealth brand for two years but we were hoping to retire it by the end of 2023,” he said – a move now postponed until early in the new year.
McLachlan took over as Fisher chief in April 2017 as eponymous founder, Carmel Fisher, stepped away from the business. He joined the group following almost five years leading the Co-op Bank and 11 years as Westpac NZ general manager.
Starting life as NZ equities boutique in the 1990s, Fisher is now the second-largest KiwiSaver provider in NZ and vies with ASB for the number two spot in the overall retail funds rankings behind top dog, ANZ. The group is two-thirds owned by the Toi Foundation (previously known as the TSB Community Trust) with the remaining stake held by US private equity firm, TA Associates.
After overseeing the latest phase in the Fisher growth story, McLachlan said his time in “executive life” is probably over.
“Retirement comes for all of us eventually,” he said.