Inside Money: ANZ surrenders staff super scheme to KiwiSaver

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.