There is still a need for consolidation to occur within the Australian superannuation industry, according to new analysis released by KPMG.
KPMG’s Super Insights Dashboard and Report, released today, has found that while large funds are getting larger, there are still too many smaller funds which need to consider their futures.
The KPMG research also suggests that, in terms of market share, industry funds have caught up with retail funds over the past decade, noting that in the last decade a migration of market share from retail to industry funds with corresponding increase in assets under management (AUM) by industry funds had occurred.
It said that from 2004 to 2016, retail funds declined in market share from 43 per cent to 29 per cent, with the market composition now virtually one third retail, one third industry/public sector and one-third SMSF.
Commenting on the findings, KPMG head of wealth advisory, Paul Howes said industry funds were no longer the challenger.
“They are now the incumbents,” he said.
“Judged by both AUM and the number of accounts held by funds they are the equals of the retail funds, whose cash flows are relatively weaker and whose lead in number of members is falling.
“At a macro level, the sector is effectively reshaping from its traditional divide between retail, industry and corporate funds to a converging grouping based on the level of AUM and complexity of operating model and offerings.”
The other findings of the KPMG research included:
Future Group is set to take on nearly $1 billion in funds under management (FUM) and welcome more than 100,000 new members following two significant successor fund transfers.
Insignia’s Master Trust business suffered a 1.9 per cent dip in FUA in the third quarter, amid total net outflows of $1.8 billion.
While the Liberal senator has accused super funds of locking everyday Australians out of the housing market, industry advocates say the Coalition’s policy would only push home ownership further out of reach.
Australia’s largest superannuation fund has confirmed all members who had funds stolen during the recent cyber fraud crime have been reimbursed.