Funds & Advisory

The Industry

• As at 30 June 20 KiwiSaver funds had attracted $70.6 billion, representing a 14.8% growth in funds under management from the previous year. Average Kiwisaver balances remained a modest $22,434 with 2.93 million active savers
• New Zealand is in the midst of introducing greater advisor and industry regulations to enhance consumer confidence (Financial Advisers Act, Financial Service Providers Register and the Financial Markets Conduct Bill)
• New Zealand investors enjoy the benefits and relative ease from a more efficient tax structure for managed funds (Portfolio Investment Entities or PIEs) and overseas investments (Foreign Investment Funds regime)
• The New Zealand industry is relatively under-supplied with circa NZD157 billion in managed funds, with in excess of 590 funds – representing a growth of 63% over the past ten years.
• The once institutionally dominated Intermediary market is increasingly being replaced by a fragmented cottage advisory industry, which comprises some mid-sized dealer groups and plenty of smaller entities. There are a total 8,804 financial advisers in New Zealand, of which 1,900 are authorised financial advisers.
• Institutional asset consultants include Russell, Mercers, Cambridge, Jana and Aon/Hewitt and a small number of boutique consultants. Morningstar and recent entrant MyFiduciary are the key retail research houses. Interestingly Zenith have recently purchased local research house FundSource.