Despite being a growing reservoir of funds under management, this critically important pool of capital is confronting mounting problems collating and disseminating key data in a timely manner.
The ratings house is pinning its growth strategy on a revamped methodology that increases the emphasis on governance to 25 per cent – a timely move considering APRA’s proposed reforms.
OneVue going after industry fund market
Connie Mckeage
OneVue Holdings has announced that it is moving on the third part of the super industry in which it does not already have a foothold – industry funds – with its digital SMSF offering. Fundamental changes are happening faster than most of us think, according to Connie Mckeage.
Mckeage, the chief executive of the listed OneVue, told the company’s annual meeting in Sydney, on November 5, that there was a “real groundswell of change coming” and anyone who didn’t “get it” would struggle to survive.
She said that industry funds (and other not-for-profit fiduciary funds) did not have an answer for the leakage that was occurring among their high-balance members to the SMSF market. OneVue already had a strong presence among retail funds and in the SMSF market.
“We have an SMSF solution for them and we think that will be a big part over our growth over the next 18 months,” she said. “People say that only the big funds will survive but that’s not necessarily the case. We are seeing that small funds can deliver a competitive product at a competitive price and that’s best for consumers.”
The launch this year of brightday, the News Corp-owned SMSF admin and information portal, was a testament to this. Mckeage described the relationship with News as one of the most fulfilling OneVue had had. “Their job is to understand the customer base and our is to deliver,” she said. News also funded the development of the portal, which uses the IP generated by its Eureak subsidiary founded by Alan Kohler.
About 20 of the largest industry funds have introduced member-directed investment options (MDIOs) over the past three years, starting with the biggest, AustralianSuper. However, they have not attracted as much money from members as would have been hoped for but they have improved engagement between the funds and their better-heeled members.
On the morning of the annual meeting, OneVue announced the acquisition of the small super admin company Super Managers Australia (SMA), for $5.2 million in cash, which would round out its offering for the fund service division. SMA has about $1.1 billion under administration for 22,000 members. The transaction was funded by a new short-term bank loan, thus preventing shareholder dilution. The share price has been firming in the past few months and recently hit 54c, compared with last year’s listing price of 34c.
OneVue has two main arms: platform services, which encompasses the high-tech growth part of the industry, such as brightday, and fund services, which includes the more stable unit registry and managed fund administration services business, as well as the Select Asset Management funds management arm. In other news, she said, OneVue was looking to:
>Â Launch an international equities capability
>Â Apply for a MySuper licence to enable the company to further participate in the super market, and
>Â Sign up new white-label clients
>Â Roll out a new model portfolio functionality
>Â Assist the evolution of “product constructs” in platform services to enable the next generation of investors to invest in what they want to, such as venture capital.
“These initiatives should result in increased quarterly net inflows in the second half of 2016,” she said.
NOTE: the author is a small shareholder in OneVue.
