SIL and MFL stop taking new members

[UPDATED] Advisers say it is not surprising that the SIL Mutual and MFL Mutual superannuation schemes have decided to stop accepting new members.

Tuesday, April 5th 2016, 3:23PM

Ana-Marie Lockyer

It was announced yesterday that ANZ Investments had been reappointed as the manager of both schemes.

But they are closing their doors to new members from September 16.

SIL has $651 million in its funds while MFL has $518 million.

ANZ general manager of wealth products Ana-Marie Lockyer said that ANZ Investments was delighted to be reappointed as manager of the schemes.

“Our reappointment ensures continuity of management for members, with the existing trustee and manager remaining in place,” said Lockyer. “All existing benefits will be retained and members will continue to be able to access their funds at age 60.”

Over the past couple of years, fewer than 100 new members have joined the schemes, reflecting the growing popularity of KiwiSaver schemes as a result of government contributions.

That had driven the decision to stop accepting new members.

“Going forward, this will mean less administration cost and we are therefore able to reduce our management fee, delivering even greater value to existing members,” Lockyer said.

Adviser Robert Oddy said the move was not a big surprise. "I would have thought they would have difficulty getting new members now anyway. People seem to have hung in there but it might be more by apathy than desire."

Former IFA president Nigel Tate agreed. "These funds go way back to Armstrong Jones. They are rationalising a lot of the product lines at OnePath and this doesn't surprise me. Over time I expect we will see them amalgamated into other funds, if they can get an alignment."

Tate said the funds had been outmoded by KiwiSaver. "OnePath and ANZ have a reasonable suite of KiwiSaver funds now and the cost of maintaining a fund with so few members is probably exorbitant."

Management fees have already been reduced from January 2016, and a further reduction will take place from January 2017, with fees reducing by on average 46% for SIL and 36% for MFL.

“Longer term, we will ensure the management fees for the SIL and MFL schemes remain tied to the management fees we charge on our award-winning KiwiSaver schemes,” said Lockyer. “This means existing SIL and MFL scheme members will also benefit from the economies of scale that flow from the increasing size of the ANZ KiwiSaver Scheme.

“SIL/MFL scheme members will also benefit from new services to be rolled out in the future such as general and life insurance discounts, and secure digital portal access, which will allow them to view and manage their investment online.”

ANZ Investments is New Zealand’s largest fund manager, with more than $24 billion in funds under management

Tags: ANZ