The KiwiSaver market took a $4.6 billion hit in the March quarter as net inflows of about $1.1 billion were more than offset by investment losses of $5.7 billion, according to new figures from Australian research house Plan for Life (PFL).
KiwiSaver kingpin, ANZ, booked the biggest loss in nominal terms (down more than $1.2 billion) and was about equal with AMP as measured proportionally. The AMP scheme went backwards 8.2 per cent in the first three months of 2020, just 0.1 per cent more than the ANZ KiwiSaver collective.
Milford also suffered a tough quarter with a 7.7 per cent decline taking the high-flying provider back under the $2 billion watermark it first breached late in 2019.
Elsewhere, quarterly growth rates ranged from -7 per cent (ASB and Generate) to a positive 0.4 per cent result for BNZ, the only scheme to report in black ink to PFL for the period.
Simplicity also came off relatively well during the turbulent March quarter, falling just 0.6 per cent to finish with $985 million under management – just $6 million below its December 31 number.
As two of the fastest-growing schemes in recent times, both Simplicity and BNZ may have been helped by outsize inflows: the PFL report does not separate investment returns and flow figures by provider.
But the three months ending March 31, that took in the worst of the COVID-19 market slump, proved particularly tough for smaller schemes outside the 12 named providers in the PFL list.
The ‘others’ sector reversed almost 11 per cent during the first quarter of 2020 compared to the market average fall of just above -7 per cent.
In total, KiwiSaver funds under management stood at more than $61.6 billion as at March 31 versus over $66.2 billion three months previously.
A strong market bounce post the first quarter balance date will probably have erased most of the early 2020 KiwiSaver losses – although some quirky results may appear in the June 30 statistics.
Meanwhile, the latest Inland Revenue Department (IRD) data shows total KiwiSaver membership went backwards in April for the first time. But the 13,000 plus fall in KiwiSaver members
from March to April likely reflects a data clean-up as the IRD moved schemes over to its new START system.
Indeed, the May IRD KiwiSaver report features several data holes due to the administration system upgrade.
From April to May, KiwiSaver membership increased by about 8,000 for a total of roughly 3.033 million: at March 31 the IRD counted 3.038 million members.
Despite the missing numbers, the most recent IRD figures show financial hardship withdrawals have fallen back to just 1,700 in May after jumping by about 500 in March to almost 2,000. At the same time, contribution holiday numbers (now known as ‘savings suspensions’) stabilised at about 147,000 over April and May compared to just under 133,000 at the end of February, prior to the COVID-19 panic.
Based in Melbourne, the PFL actuarial consulting and research firm was founded in 1988 by Simon Solomon while Rael Solomon is now regional managing director.