KiwiSaver report shows commission and FUM imbalance

KiwiSaver providers collected an estimated $724 million in fees in the 12 months ended March 31, according to the latest data from Morningstar, with ANZ capturing almost a quarter of the revenue.

In line with expectations, Morningstar’s fee analysis (new to the researcher’s quarterly KiwiSaver Report) shows active managers capture a greater share of returns compared to their respective share of assets under management. trend (and vice versa for passive schemes).

ANZ, for example, has collected an estimated 23.3% of total KiwiSaver fees over the 12 months and controls 20.3% of the sector’s approximately $92 billion as of March 31.

Similarly, Milford Asset Management and Fisher Funds have fee rates of 9.2% and 10.2%, respectively, on asset shares of 6.5% and 8.4%.

Passive operators, Simplicity and SmartShare, both have market shares of 3.3% and 2.1% respectively, while charging around 1.3% in fees during the year, according to a Morningstar report. bottom.

However, three major banks, ASB, BNZ and Westpac/BT, also reported much lower fee income ratios compared to the Kiwi Saver funds they manage. ASB and BNZ lean more toward passive investing, while Westpac/BT favors a more active multiman style.

However, AMP, which switched most of its KiwiSaver fund to a passive portfolio managed by BlackRock almost two years ago, shows an estimated fee income share of 6.3%, which is broadly in line with its 6.2% of total assets under management.

Greg Buncal, data director at Auckland-based Morningstar Global Fund, said the figures represent a “rough” estimate of the KiwiSaver scheme’s fees based on assets under management at a specific point in time. said. Actual scheme fees may vary slightly based on other factors such as cash flow and performance enhancing factors.

Further, he said the scheme fee estimates are not evaluated based on experience.

As of March 31, ANZ remains the number one Kiwi Saver Fund ranking under management with $18.7 billion (across three schemes), followed by ASB with nearly $14.5 billion.

But a Morningstar analysis shows that the combined KiwiSaver business of Fisher and Kiwi Wealth would be just $55 million short of ASB.

The strong performance continued in the March quarter, with “all multi-sector KiwiSaver funds posting positive returns in the March quarter,” the report said.

“Average returns for multi-sector categories ranged from 2.9% for the conservative category (including default options) to 5.6% for the aggressive category.”

Returns in the quarter ranged from about 73 percent for the $1 million small Kora cryptocurrency fund to minus 4.8 percent for the Superlife Australian property fund. Over the 12-month period, the InvestNow Antipodes Long World Equity Fund reported the highest return of 13.8%. %, and the Nikko Arc Disruptive Innovation Fund bottomed out at almost -35%.

Morningstar’s research covers over 90% of the KiwiSaver market, but excludes some providers, notably NZ Funds Management.