HSBC’s retail kingmaker gets kept

By Michael Bailey

CHALLENGER Financial Services has signalled it is serious about winning over more advisers, confirming that HSBC Asset Management’s head of distribution will join Challenger following its acquisition by the Kerry Packer-owned group.

Michael Lovett will stay in Melbourne but now report to Challenger’s Sydney-based head of distribution, David Asplin.

The purchase of HSBC’s Australian asset management business, and the retaining of Lovett’s “high profile with advisers”, would boost the recognition of Challenger in the retail market, according to Asplin.

“At somewhere like Navigator, previously we might have been just inside the top 10 of the fund managers they favour, but I think this acquisition will put us firmly inside the top five,” Asplin said.

Other dealer groups where the HSBC acquisition would assist Challenger were Professional Investment Services, RetireInvest and the other ING Australia dealer groups, Asplin said.

Meanwhile, Navigator, Macquarie Wrap, BT Wrap, IOOF, Skandia and Synergy have begun or will soon begin to offer a product investing in Australian shares outside the Top 300 for the first time, following their acceptance of the recently launched Challenger Microcap Fund.

The extremely limited capacity of Australian microcap funds means the Challenger product, managed by the small cap team of James Ring and Michael Courtney, will be closed when it reaches $100 million under management.

Navigator’s research manager, Stuart Fechner, said his team had jumped at the opportunity to offer Challenger’s product as it is expected to be shut off within 12 months.