Liquidity has never been a major issue for Australian superannuation funds, but the sub-prime crisis and its implications have given rise to questions on this issue.
With this in mind, two key executives from the Australian Prudential Regulation Authority (APRA) will be addressing one of the opening workshops of this year’s Conference of Major Superannuation Funds titled ‘Liquidity, Licensing and Super Funds — What’s on APRA’s Agenda’.
The two executives are APRA’s general manager, specialised institutions division, South West Region, Stephen Glenfield, and the general manager, specialised institutions divisions, central region, Ramani Venkatramani.
The subtext for the session is the impressive growth enjoyed by superannuation funds in the past with strong inflows has not given cause for any liquidity concerns but this may well change in the future given an ageing membership, relaxations on benefit payments and improved portability.
It suggests “market gyrations together with choice of funds may cause significant outflows from some funds, even if the total assets of the industry remain unaffected”.
“In tune with the increasing sophistication of the industry, how should trustees identify the related issues and trade-offs? What can they expect by way of regulatory scrutiny, and where does risk management need improvement?”
The session is also expected to provide a forum for the two executives to explain the results of the recent round of fund reviews — one of the first in the new trustee licensing era.
