Two More Australian Supers Considering Merger

Two of Australia’s largest pension funds are looking to merge, pooling their assets to form a A$110 billion ($78 billion) retirement kitty.

First State Super and VicSuper Pty made their consolidation talks public Thursday as they begin to “explore the benefits” of the move, which would make them the continent’s second-largest non-profit superannuation fund.

“We have a lot in common,” VicSuper said in a statement. “We’re both profit to member funds, put our members first and believe in the importance of financial advice to help our members make the most of their retirement savings, while also sharing members from similar industries.”

Both funds invest the retirement assets of teachers, nurses, and community-service workers in Victoria and New South Wales.

For more stories like this, sign up for the CIO Alert newsletter. 

This builds on the consolidation trend in Australia’s pension industry. Underperforming funds are under more intense scrutiny by the nation’s government, leading to new laws that call on boards to consider the best interests of plan members. One option is for some organizations to cut their losses and build a bigger, and presumably better, institution. These moves are also cost-effective for the asset owners.

Last month, Sunsuper and AustSafe Super completed a merger that not only turned the new fund into a A$64 billion juggernaut but will also save about A$10 million annually for its members.

“The opportunity to achieve greater scale through a merger like this could help us create even better member outcomes through enhanced services and broader investment opportunities delivering sustainable investment returns,” said VicSuper, adding that nothing has changed and neither fund has yet made a decision considering there is “no obligation to proceed.”

Deanne Stewart, the First State Super’s chief executive officer, could not be reached for comment

Do you have any thoughts on this article? If so, feel free to share your opinions in the comment section below!

Tags: Australia, First State Super, Merger, Pension, Superannuation Funds, VicSuper

For the second installment of CIO’s NextGen list, we’re inviting asset owners and managers to champion the brightest rising stars of the industry.

From your nominations, CIO will select 25 future leaders to be profiled in candid Q&As that highlight their skills and interest. NextGen replaced our Forty Under Forty list last year, which means candidates can be over age 40, but below 50. Additionally, nominees can be former Forty Under Forty achievers but cannot repeat from last year.

Asset owners and managers can make nominations, but those selected must work for asset owners.

This is not just an ego boost for these individuals. As with our previous Forties, NextGens have been able to break the glass ceilings and enter the upper echelons of the industry.

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news. 

When she was featured last June, Jenny Chan was the senior investment officer for the Doris Duke Charitable Foundation, an organization she worked at for 11 years. By August, she had been named CIO of the Children’s Hospital of Philadelphia. The same can be said for Mark Shulgan, the new growth equity managing director at OMERS, who was the senior portfolio manager for thematic investing at the Canada Pension Plan Investment Board (CPPIB) at the time of his profile. Charles Wu, another previous NextGen, was promoted to deputy CIO of Australia’s State Super earlier this year.

Nominations, of course, will be kept anonymous to provide the best experience possible. To nominate, please answer this questionnaire about who you think is the next big investment rock star. If more than one candidate comes to mind, feel free to feature multiple nominations in your answers, and please incorporate as much detail as possible in your responses.

A few rules:

1. Nominees must be asset owners working in public and private pension plans, endowments and foundations, sovereign wealth funds, and/or single-family offices (they cannot be asset managers, outsourced-CIOs, or multi-family offices).

2. Nominees must be senior investment professionals working with or reporting to CIOs.

Nominations will close on April 5.

Related Stories:

2018 NextGen

Jenny Chan Becomes CIO of Philly Children’s Hospital

Canada Pension Plan’s Thematic Investing Head Joins OMERS