Another Australian bank looks set to benefit from the sale of the ASB investment platform, Aegis, to Auckland fund administration firm, MMC.
The Commonwealth Bank of Australia (CBA)-owned ASB sold Aegis sale earlier this month for an undisclosed price after a six-month sales process.
CBA drew a healthy dividend off Aegis during its 23-year ownership of the platform but failed to keep it up to spec.
But while MMC brings Aegis under full NZ ownership for the first time, CBA rival the National Australia Bank (NAB) could see some spin-off business.
NAB Asset Servicing – MMC’s global custodian – is likely in the box seat to pick up a bonus A$10-13 billion of new custody assets.
Peter Hele, NAB Asset Servicing’s head of business development for Australia and NZ, based in Melbourne, negotiated the successful partnership with MMC in 2011.
NAB struggled to justify the development of new systems to administer NZ’s complicated PIE and KiwiSaver products.
NAB wanted to participate more in the NZ market, which is an important and growing one, but couldn’t do all the PIE-compliant and other local admin stuff without a fair amount of work.
So, the Aussie custodian pitched to MMC to do a joint venture. MMC appointed NAB as its Australian and global custodian. MMC does local custody itself.
The Aegis sale is due to complete in December.
Greg Bright is publisher of Investor Strategy News (Australia)