IOOF has partnered with Invesco to manage $23.1 billion in index investments within the former ANZ pensions and investments business, which was acquired by IOOF last year.
The 14 index mandates, which formed the OneAnswer index funds as well as Smart Choice and OnePath diversified funds, would transfer to Invesco by early June 2021.
The changes would occur at the underlying asset level of the funds so there would no change to fees, buy/sell spreads, investment objectives, asset allocation ranges, standard risk measures or distribution frequency, or tax.
Stanley Yeo, IOOF’s deputy chief investment officer and head of equities, led the Invesco move and said the firm reviewed several index managers as part of the due diligence process.
“Invesco was selected based on its high aggregate score across the following criteria: portfolio construction, implementation and risk management, business management, smart beta capabilities and environmental, social and governance (ESG) credentials,” Yeo said.
“Further, Invesco has the necessary skill, experience, resources and scale to deliver close tracking of indices.
“The scale of Invesco’s operations provides it with significant resources relative to smaller competitors.”
Invesco’s indexing business was worth over $388 billion which extended across equities, fixed income, and alternatives.
Andrew Lo, Invesco’s senior managing director and head of Asia pacific, said this partnership would deliver the firm’s indexing capabilities to IOOF’s nationwide adviser network and client base.
“We are proud to work with IOOF in providing this broad range of compelling investment offerings to Australian investors, and this agreement marks a major milestone for Invesco’s Australian business,” Lo said.
“We also look forward to supporting IOOF’s clients in meeting their financial goals.”
