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Managed funds hit by market turmoil in June quarter

Fuseworks Media
Fuseworks Media

Wellington, Sept 28 NZPA - KiwiSaver growth slowed to 4.3 percent in the last quarter as world markets declined, although annual growth was nearly 80 percent, according to research released today.

Fund inflows were less impressive with a decline of 4.9 percent for the three months ended June, although annual growth was 16.6 percent, actuaries Plan for Life and Eriksen Associates said.

ING NZ had the largest slice of the KiwiSaver market at 22.5 percent, or $1.29 billion. ING's quarterly growth rate was 6.5 percent, and its annual growth was 100 percent.

The 10 biggest funds had annual growth of over 77 percent.

The larger companies had been increasing their relative market shares as investors favoured default providers, and smaller fund managers bowed out, the researchers said.

Total KiwiSaver funds were $5.72b, with gross inflows of $2.9b for the year to June.

All retail managed funds, including KiwiSaver, fell by 3.5 percent during the quarter to $24.2b as markets reacted to potential sovereign debt defaults.

For the year, total funds rose by 13.7 percent, with growth rates topped by Mercer (31.5 percent), Fidelity Life (23.6 percent) and ING (17.7 percent).

ING had 18 percent of the managed fund market, followed by AXA NZ (15.2 percent) and ASB Group Investments (14.1 percent).

Non-KiwiSaver superannuation funds declined by 7.2 percent in the quarter to $5.2b, but were up 1.4 percent over the year.

Gross inflows were up 0.6 percent for the quarter, but fell 19.6 percent annually as investors redirected money into KiwiSaver funds.

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