ANZ has carved off more than .05 per cent on some of its KiwiSaver and retail funds while launching a high-octane growth product targeting diversified risk-takers.
In a release last week, ANZ head of funds management, Fiona Mackenzie, said the price cuts, which range from .06 per cent for the balanced and growth options to .01 per cent for the lower-risk funds, come after a series of reductions has lowered average annual fees in its non-default KiwiSaver schemes by about a third in recent years.
“It’s part of our ongoing commitment to ensure our fees provide good value for money for our customers,” Mackenzie said.
Over the 12 months to the end of March 31, for example, the flagship ANZ KiwiSaver scheme saw its management fee haul drop to $115 million from more than $125 million in the previous period – including the removal of administration fees that added some $4.2 million to the bottom line in 2022.
Many KiwiSaver schemes, including all of the big-name brands, have removed the member administration fees over the last couple of years.
But aside from the fee tweaks, ANZ has expanded its diversified investment suite with the addition of the high-growth option that targets an equities allocation of 95 per cent: the remaining 5 per cent is set aside for cash.
While the new high-risk product taps into the same panel of underlying managers as other ANZ investment funds, the strategy has a zero target allocation to fixed income (although it has the flexibility to range up to 20 per cent in the asset class) compared to 16 per cent for the standard growth fund.
The ANZ high-growth fund – available via the bank’s main KiwiSaver and the OneAnswer schemes as well as in retail formats – also has a slightly higher strategic tilt to listed real assets (infrastructure and property) than the growth option.
Paul Huxford, ANZ Investments chief investment officer, said the high-growth fund was designed for “clients with a high tolerance for risk, who want a diversified exposure to growth assets, across the globe”.
Huxford said the group anticipated strong demand for the new higher-risk fund, especially from younger investors looking for longer-term growth.
Other juiced-up strategies have found some support in the KiwiSaver market such as the long-running Generate Focused Growth Fund, which reported about $1.8 billion under management at the end of March in a similar 95 per cent equities approach.
And the risked-up Milford Asset Management Aggressive Fund has quickly grown to almost $1.2 billion since inception in June 2021.
ANZ remains the largest non-government fund manager in NZ with more than $30 billion in assets under management including close to $19 billion across its three KiwiSaver products.
The ANZ and OneAnswer KiwiSaver schemes reported $14.5 billion and $2.7 billion under management at the end of March this year while ANZ Default scheme held almost $1.5 billion.
ANZ lost default status as at the end of November 2021 but retains the scheme, now closed to new members, under the original name: the new high-growth fund will not distributed through the ex-default scheme.