David Chaplin 's Opinion

A personal finance columnist for the NZ Herald

Inside Money: ANZ surrenders staff super scheme to KiwiSaver

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Photo / Mark Mitchell
Photo / Mark Mitchell

One of New Zealand's largest stand-alone employer superannuation scheme, the $230 million plus ANZ National Bank Staff fund is winding up with the proceeds to be paid out to members or rolled into KiwiSaver accounts.

As I reported in April, the arrival of tough new rules super schemes has been problematic for the dwindling number of employers who still offer such a benefit.

And while ANZ may have had other reasons for shutting its old-school staff fund, launched in 1972, the extra regulation was undoubtedly a factor.

An ANZ spokesperson said the bank has "consulted widely with staff about the change".
"Our in-house super schemes were developed in a very different era of the retirement savings industry and employer-based schemes generally are now declining in number," the bank spokesperson said.

According to the latest ANZ National Bank Staff Superannuation Scheme annual accounts, members would have a choice of cashing-out or reinvesting "standard balances" - ie any amount not subject to a lock-in clause - with the remaining locked-in amounts to be transferred to a KiwiSaver scheme.

The 'locked-in' portion of the $236 million ANZ Staff super scheme would be relatively small given the option only became available with the introduction of KiwiSaver in 2007/8.

Nonetheless, a significant slice of the ANZ National staff fund will most likely roll over into one or other of the bank's KiwiSaver schemes.

The biggest losers from the wind-up will be the scheme's external fund managers, AMP Capital and Russell Investments, which stand to lose mandates of about $124 million and $82.4 million respectively, based on the December 2013 accounts.

There is one small exclusion from the ANZ scheme wind-up, however, with the 'defined benefit' section soldiering on, as required by contractual agreement with the lucky few who managed to secure such a deal before the bank realised its mistake. Those on defined benefit (DB) agreements are entitled to fixed pensions, usually based on a percentage of final years' remuneration.

Just 20 individuals remain in the ANZ staff DB pool, which closed to new members in 1990, with a tad over $5 million - or about $255,000 each - set aside to fund their pensions.

- NZ Herald

David Chaplin

A personal finance columnist for the NZ Herald

David is a freelance journalist who has covered the financial services business on both sides of the Tasman for over 15 years. David has edited magazines and websites for the financial advice, investment and superannuation industries. Today, he contributes to various publications in Australia as well as his bi-weekly blog for the NZ Herald under the 'Inside Money' banner.

Read more by David Chaplin

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