IFSA/APRA discuss balanced fund definitions
The Investment and Financial Services Association (IFSA) is in discussions with both the Australian Prudential Regulation Authority (APRA) and the Association of Superannuation Funds of Australia (ASFA) on defining the investment parameters of 'balanced' superannuation funds, according to IFSA chief executive Richard Gilbert.
Speaking on Sky News’ Sunday Business program yesterday, Gilbert said the discussions had been prompted by the ongoing debate over the “elements” that define a ‘balanced’ super fund.
“There’s always been debate about what is a 'balanced' fund portfolio or an ‘aggressive’ or a ‘conservative portfolio’, and we’re talking to ASFA, the super lobby and also to APRA so we can get a more agreed position.
“There’s even disagreement about how the rating agencies classify these particular investments, which indicates that the super industry clearly needs to do more work on the definition of those elements.
“We want to come to a fairly quick outcome to ensure there is no doubt about that, and we can educate our customers about what is balanced and what is not.”
Gilbert was responding to a program question on whether a super fund should be entitled to be described as having a ‘balanced’ portfolio when it has a majority exposure to equities.
The question was based on a recent OECD report that found the average balanced super fund in Australia had recorded the second worst investment performance among the 30 OECD countries in 2008.
The OECD report attributed the poor performance to Australian funds having about 57 per cent of funds invested in equities during the year.
Recommended for you
The central bank has released its decision on the official cash rate following its November monetary policy meeting.
Melbourne advice firm Hewison Private Wealth has marked four decades of service after making its start in 1985 as a “truly independent advice business” in a largely product-led market.
HLB Mann Judd Perth has announced its acquisition of a WA business advisory firm, growing its presence in the region, along with 10 appointments across the firm’s national network.
Unregistered managed investment scheme operator Chris Marco has been sentenced after being found guilty of 43 fraud charges, receiving the highest sentence imposed by an Australian court regarding an ASIC criminal investigation.
