After a delay of over a year, discount retail giant The Warehouse, is about to announce the launch of its branded financial services products.
Chief operating officer for The Warehouse, Greg Muir, says the company should be in a position to give details of the financial products launch before Christmas this year.
The Warehouse was set to offer a range of financial products through its nationwide chain of stores earlier this year before the collapse of its deal with a prospective partner (rumoured at the time to be WestpacTrust).
“We’re now dealing with a different provider than last year,” Muir says.
“We went a long distance with the previous one but ultimately it was not the right choice.”
Muir says The Warehouse has been talking to a new prospective partner for two months and has progressed a lot further than in its earlier negotiations.
However, he says under the new deal The Warehouse will be able to offer the same range of products as previously planned.
The Warehouse has also begun an expansion into Australia with the purchase of two discount retailers giving it access to more than 100 stores.
NZ fund returns rise
Average returns from managed fund were up over one percent on the
previous quarter according to the latest Mercer Investment Consulting
survey of the industry.
Funds returned a median 3.2 per cent for the September quarter up from
1.8 per cent in the previous period.
Colonial First State showed the highest return with 4.3 per cent for
the quarter while the lowest return of 2.5 per cent was achieved by
Arcus Investment Management.
Mercer says the Colonial result was helped by a strong Australasian
share performance from a portfolio that excluded Telecom, New
Zealand’s largest listed company.
The survey also measured a median return for the year of 15.9 per cent
before taxes and fees with BT Funds Management topping the list on
23.3 per cent.
Tower Asset Management showed the lowest returns for the year with
11.9 per cent.
Brokers merge
New Zealand¹s oldest stockbroking firm, Frater Williams, has merged
with national sharebrokers and fund manager, Forsyth Barr, to form
what its owners claim is the biggest private client sharebroking base
in the country.
Eion Edgar, chair of Forsyth Barr, says the new grouping will have
access to a private retail client base of over 100,000 with 84
advisers in 10 offices throughout the country.
He says the merger follows two years of negotiations with Frater
Williams and is part of Forsyth Barr¹s strategic push into the
northern half of New Zealand.
³Forsyth Barr previously didn¹t have a strong presence in Auckland but
it is the largest retail sharebroker in the three other centres
[Dunedin, Christchurch and Wellington],² Edgar says.
He says Frater Williams offered a good complement as its client base
is concentrated in Auckland and in other centres north of Taupo.
³While Frater Williams is about the same size as Forsyth Barr in terms
of turnover on the New Zealand stock exchange, we¹re more diversified
with about $500 million in funds under management,² Edgar says.
³We¹ll now be able to offer the same services nationally. The merger
is a growth situation not a cost-cutting exercise and no staff will be
made redundant.²
He says the new entity (trading initially as Forsyth Barr Frater
Williams north of Taupo and Forsyth Barr elsewhere) will offer the
only national distribution service for new issues, IPOs and New
Capital Market offers.
Frater Williams head, Garth Williams, says the deal is a ³natural fit²
and will benefit both companies.
³Forsyth Barr has strengths we don¹t such as it investment management
services and other fund facilities – the sort of thing we¹d have to
pay a lot for to develop ourselves,² Williams says.
He says Frater Williams also has unique services that will add to
Forsyth Barr¹s range including its Top 40 Index Fund.
³We¹re also both New Zealand owned which is a big plus,² Williams
says.
Edgar and Williams say that the company remains independently, New
Zealand owned and operated.
³We believe that we can deliver strength to clients through our
independence while at the same time benefitting from our international
links to major investment houses,² Edgar says.
However, Williams doesn¹t rule out a takeover by an overseas firm at
some time in the future if the offer was right.
³We¹d have to listen to whoever approached us,² he says.
Williams says a foreign sharebroking firm had already expressed
interest in Frater Williams.
Edgar says the company will continue to run two operations as it seeks
to integrate the back-office of both firms.
³It¹s important we maintain stability in the interim,² Edgar says.
³We¹ll have to get together to decide if we want to buy an entirely
new back office system or use one of the existing ones.²
Edgar says the merger with Frater Williams doesn¹t mark the end of
Forsyth Barr¹s expansion plans and expects other brokers around the
country may wish to join the group.
A grouping of investment industry, trade union and employer bodies is
lobbying the Government to simplify employer superannuation schemes.
The Association of Superannuation Funds of New Zealand (ASFONZ)
together with the Council of Trade Unions (CTU), the New Zealand
Employers Federation, the Investment Savings and Insurance Association
(ISI) and the Retirement Commissioner have produced a joint approach
on ways to make employer super funds easier to set up and run.
Head of the ISI, Vance Arkinstall, says the group has identified
several issues that have been causing the decline of employer
sponsored superannuation schemes in New Zealand.
³There are a number of impediments to employer super schemes that
could be simplified without reducing the security of individual
accounts,² Arkinstall says.
He says the Labour Party, United, ACT and the Green Party have all
reacted positively to the joint proposal while the National and
Alliance parties will consider the issue soon.
³It looks as though all political parties could come together in a
very positive way to encourage employer superannuation schemes,²
Arkinstall says.
