Perpetual Trustees has been hit by a noticeable slump in the flow of funds into its managed investment products as retail investors draw back from equity market investments in the wake of the terrorist attacks in the US.
Perpetual managing director Graham Bradley said yesterday the group’s overall revenue had been depressed by the performance of its investment division since the terrorist attacks as investors responded to the crises by shying away from world equity markets and looking for safe havens away from the uncertainty.
“Over the past six weeks we have seen a reduction of net inflows into our equity funds from prior levels, but we have witnessed increases in flows into our cash, mortgage and balanced funds,” Bradley said.
Speaking at the group’s annual general meeting, Bradley said Perpetual, which had suspended all applications, redemptions and switches in its funds with exposure to the US market for almost a week in the immediate aftermath of the US tragedy, was expecting fund inflows to continue to be affected in coming months.
However Bradley said the group was not expecting a revenue shortfall in the first six months of this financial year, despite the cloud of investor insecurity hanging over the performance of its investment division.
“At this stage we remain confident that Perpetual’s half year operating profit result to December 2001 will be comfortably ahead of our half year result of $19.2 million earned in the corresponding December 2000 half year provided markets do not deteriorate markedly in the next few months,” he said.
Bradley also used his address to shareholders yesterday to call on the government to raise the level of compulsory employer superannuation contributions, due to rise to a maximum of nine per cent next year, to as high as 15 per cent.
“I think both major political parties have to address the adequacy of the nine per cent levy,” he said. “I am strongly of the view that figure should be as high as 15 per cent. Any government will have to address [the level of contributions] if they are serious about relieving the burden on the public purse.”
The annual general meeting was the last for Perpetual’s outgoing chairman John Lamble, who is retiring from the board this week after seven years to make way for new chairman Charles Curran.
