IOOF has announced significant new platform arrangements, terminating its existing relationship with BT.
Announcing the move to the Australian Securities Exchange, IOOF chief executive, Renato Mota said that IOOF had embarked on its own platform simplification strategy, aligning with providers who fit within its open architecture approach.
He said the agreement with BT included termination rights for both parties on 12 months’ notice and provided IOOF with rights in respect of the unwinding of the current arrangements and the transition of clients and funds to other providers.
It was estimated that the cost of such a transition from BT would cost IOOF between $30 million and $70 million and when combined with anticipated customer attrition made such a strategy unattractive.
The announcement said IOOF would receive a one-off settlement of $80 million pre-tax which took into consideration amounts owed in recognition of IOOF’s rights under the agreement.
Mota said that consistent with IOOF’s open architecture approach and platform strategy, IOOF was entering into an agreement with HUB24 and that HUB24 would act as the platform administration and custody provider.
