The NZ retail fund market rocketed to an all-time high above $128 billion during the December quarter in a period that saw Milford Asset Management join the 11-figure club.
According to the just-released quarterly survey from Australian researcher Plan for Life (PFL), Milford piled on almost $1.3 billion in net retail funds under management (FUM) over the three months to the end of 2021 – more than any other provider in nominal and proportionate terms – closing out the year with over $10.5 billion in the kitty.
Milford was up 13.8 per cent for the quarter closely followed by Fisher Funds (11.1 per cent) and Booster (10.2 per cent). Over the 2020 calendar year the smaller ($3.5 billion) BNZ reported the fastest growth-rate of 28.2 per cent with Booster (27.9 per cent) and Milford (27.4 per cent) not far behind.
Bar the four largest managers – ANZ, ASB, Westpac/BT and AMP – all of the top 10 providers named in the PFL survey recorded double-digit percentage growth for the year and strong final quarter figures.
In line with recent trends, AMP was the only manager to go backwards in 2020 with FUM shrinking -1.1 per cent both over the year and quarter: the NZ wealth arm of the ASX-listed group (currently switching to a BlackRock passive investment strategy) saw market share slip a further 1 per cent during the 12 months to end at 9.1 per cent as FUM dropped to $11.6 billion roughly $130 million below December 2019 result.
By contrast, Milford gained 1.1 per cent market share over the same period to finish 2020 on 8.2 per cent; Fisher also was a big mover last year, adding 0.7 per cent market share to sit 1 per cent behind Milford.
ASB and Westpac – in order, the second- and third-largest retail managers – carved out solid, if below average, growth during the 12 months of 7.7 per cent and 5.5 per cent, respectively.
While growth-rates tend to slow as FUM hits critical levels, the biggest retail provider, ANZ, lagged its bank rivals in 2020, up just 2.5 per cent. However, the ANZ result was skewed by the closure of the approximately $3 billion Bonus Bonds product in 2020, which dented market share: for the December quarter ANZ grew on a par with fellow banks.
Mid-table players, Mercer and Kiwi Wealth, both turned in decent growth-rates over the 12 months of 17.3 per cent and 12.7 per cent, respectively. Mercer, in particular, reported a strong December quarter, growing almost 10 per cent to reach more than $7.3 billion in FUM.
Outside the named groups, the collective ‘others’ again outperformed, growing 14.8 per cent over the annual period and 6.6 per cent in the December quarter against the respective averages of 9.9 per cent and 5.5 per cent.
The PFL survey found total gross inflows for the NZ retail funds market hit $38.7 billion last year, climbing 25 per cent for the 12-month period and 10.7 per cent in the final quarter.
“Year on year AMP, Milford, Fisher, Kiwi Wealth, Mercer and BNZ posted above average Inflow growth rates while on the other hand those of BT were flat,” the PFL report says.
As at the end of 2020, KiwiSaver FUM landed at just over $79 billion – up 19 per cent compared to the previous year. However, non-super retail funds were down -3.3 per cent year-on-year to close the period at about $40.5 billion – the annual decline likely reflected the Bonus Bonds exit but, regardless, the sector clocked in a sluggish 1.3 per cent growth in the December quarter.
The Melbourne-based PFL, headed by Rael Solomon, is owned by global proxy voting firm Institutional Shareholder Services.