Fund Product, Company and Regulatory Updates as at 12 March 2019

Product Updates

01 PFL Product Company Regulatory.jpg

Low carbon fund launched by Russell Investments
Global fund manager Russell Investments has launched a new fund investing in ASX-listed companies that have low exposure to carbon emissions and fossil fuel companies. The Russell Investments Low Carbon Australian Shares Fund is to use the S&P/ASX 300 Accumulation Index as it commences, then moving to a rules-based approach.

Investec launches Global Environment Strategy
Investec is identifying businesses where products contribute actively to reducing carbon emissions. The strategy is open to Australian clients privately, for investments in its Luxembourg-domiciled UCITS vehicle. This strategy is not registered directly in Australia.

Allianz Retire+ first investment product launched
Allianz Retire+ Future Safe is a retiree-oriented seven-year investment product issued by life insurance company Allianz, with options of fixed rate, market-linked investments and protection options to suit. Investments start at $20,000. The new business is powered by PIMCO and Allianz in their first co-branded venture.

BlackRock launches Australian ESG bond fund
A new indexed fund by BlackRock is investing in Australian bonds with an ESG focus, with VicSuper providing the seed funds. The ESG-focused Australian Bond Index (ESGABI) fund is the first Australian ESG bond fund and the first indexed ESG fund with a dedicated Australian ESG benchmark. The fund excludes tobacco, alcohol, gambling, military weapons, civil firearms, nuclear power, adult entertainment, genetically modified organisms and fossil fuel reserves using MSCI’s SRI index.

Company Updates

IFM Investors establishes emissions reduction targets
IFM Investors has released its 2018 Infrastructure Carbon Footprint Report, where it establishes emissions reduction targets and pathways for its infrastructure portfolio and measures its emissions footprint.

Sunsuper implements advice fee caps
Sunsuper’s financial advice fees paid directly from a superannuation balance will now be capped to meet the Sole Purpose Test. Initial fees are limited to the lower of $4,400 or 2.2 per cent of the balance (incl. GST) and are only payable once every three years.

Where account balances are under $50,000, Sunsuper must sight a Statement of Advice. The price of ongoing fees is capped at the lower of $6,600 or 1.1 per cent of the account balance per year (incl. GST), payable monthly for up to two years. Any members with balances under $50,000 will not pay ongoing advice fees.

Statewide Super considering merger with WA Super and Tasplan
Advanced merger talks are taking place between Statewide Super and WA Super and Tasplan. A Memorandum of Understanding has been signed. The merged entity would be worth $24 billion in superannuation savings, serving over 380,000 members, taking 15th place in size of Australian superannuation funds.

Loomis Sayles launches credit fund
Australian wholesale investors now have a new bond fund, the Loomis Sayles World Multi-Asset Credit Fund that invests in global investment grade and high-yield credit, bank and securitised loans, and emerging market sectors.

Regulatory Updates

New super legislation to drop fees, consolidate low-balance accounts
Around five million superannuation accounts may see a fee drop to less than three per cent after Protect Your Superannuation legislation was passed through the Senate. Accounts under $1,000 that have been left for over 16 months will be consolidated, with accounts of $6,000 or less to have fees capped at three per cent. Superannuation exit fees are to be removed, enabling members to switch funds without penalty.

Abu Dhabi and ASIC sign collaboration agreement
Abu Dhabi and Australia have signed a partnership agreement to strengthen collaboration between the two jurisdictions. The Registration Authority of the Abu Dhabi Global Market (ADGM) and the Australian Securities and Investments Commission (ASIC) will streamline company registration and facilitate the exchange of information, expertise, and secondment opportunities.