Two ‘mega funds’ expected to reach $1trn in AUM
AustralianSuper and Australian Retirement Trust (ART) are expected to dominate the superannaution market over the next 10 years, according to KPMG, swelling to $1 trillion each.
In its latest Super Insights report, the firm said, excluding any other mergers, both funds were likely to grow their assets under management from around $200 billion in 2021 to $1 trillion by 2040.
Aware Super was likely to grow to $600 billion while Insignia could grow to $500 billion, both up from less than $200 billion in 2021.
KPMG said: “Under these projections, a small number of large ‘mega funds’ will continue to pull away from the rest of the population. However, in practice, multiple drivers – future consolidations, individual funds’ levels of success in attraction and retention of members, particularly in the retirement space – will impact how the market shifts”.
The level of consolidation was likely to continue for the next few years, particularly as the Australian Prudential Regulation Authority was seeking greater power to force funds to merge. There had been two successor fund transfer (SFTs) announced in 2022.
AUTHOR
Laura Dew
Recommended for you
Treasurer Jim Chalmers has handed down his third budget, outlining the government’s macroeconomic forecasts and changes to superannuation.
Online investment adviser and fund manager Stockspot has introduced Stockspot Super, Australia’s first 'ETF only' superannuation product. superannuation product.
ASIC has called on superannuation funds to improve their oversight of advice fee deductions following an investigation of 10 trustees that found $990 million was charged in one year.
With just 30 per cent of Australians knowing their superannuation balance to the nearest $1,000, Findex has emphasised the role of financial advice in addressing the critical super knowledge gap.
