BlackRock will be appointed to deliver key investment services.
Specialist KiwiSaver provider AMP Wealth Management New Zealand today announced a broader strategy to transform the AMP KiwiSaver Scheme, appointing one of the world’s leading investment managers, BlackRock Investment Management, to support it in delivering one of the most significant changes to its investment management approach since 2007.
Under a new investment structure created by AMP Wealth Management, BlackRock will be appointed as AMP Wealth Management’s key index investment manager and a provider of investment management services, once preparatory activities have been completed. AMP Capital Investors New Zealand currently performs a number of these activities.
The enhanced investment approach for AMP Wealth Management New Zealand is expected to improve outcomes for clients by delivering stronger fund performance through a simplified investment structure. There will be a clear focus on sustainable investment, supported by access to financial advice and market-leading digital tools to help clients grow their savings and achieve the best possible retirement.
AMP Wealth Management Acting Chief Executive Jeff Ruscoe says:
“Together with current investment manager AMP Capital Investors New Zealand we have delivered good outcomes for our clients. However, this change to a predominantly index tracking investment management approach is the right decision to ensure we are best placed to deliver long run returns, further value for money and continue to support the financial wellbeing of our clients. The change also enables us to have more flexibility to support key environmental and social areas to create positive change.
“Our clients will continue to benefit from our full-service offering including access to financial advice, either face-to-face or over the phone, along with our range of market-leading digital tools, to help them make the most of their investments. This includes access to a range of managed funds through other leading fund managers with different investment approaches, including Nikko, Mercer, ASB, and ANZ, providing them with even more choice and investment options to manage their savings through a single provider.”
AMP Wealth Management and BlackRock share many of the same core principles and values, including the same investment conviction that sustainable investments can deliver better risk-adjusted returns to investors.
“We are delighted to partner with BlackRock, a global leader in investing, and to utilise their resources and insights to deliver our enhanced investment approach and significant benefits to our clients. Through BlackRock we will invest mainly using an index tracking style, unless there are asset classes where the anticipated returns outweigh the extra investment management cost.
“The next stage of our investment transformation will be a repricing of funds within our AMP KiwiSaver Scheme and an implementation of our sustainable investment strategy,” said Mr Ruscoe.
Andrew Landman, Head of Australia and New Zealand at BlackRock Investment Management, says:
“BlackRock is honoured to be appointed as the key index investment manager and a provider of investment management services to AMP Wealth Management New Zealand. Our partnership will deliver AMP Wealth Management efficient index exposures and ensure access to BlackRock’s global insights and investment expertise.”
Investing sustainably is key to long run returns:
“As with our current investment management approach, we will not invest in companies that are involved in the manufacture of cluster munitions, anti-personnel mines, chemical weapons, nuclear explosive devices, civilian firearm stocks, or tobacco.
“In addition, our partnership with BlackRock will allow further consideration of sustainability factors in our investment decisions, including reducing the impact of climate change – something an increasing number of New Zealanders are interested in, and an approach we see delivering long run returns,” said Mr Ruscoe.
There is nothing AMP Wealth Management clients need to do:
The transition to the new investment model is expected to be completed before the end of June 2021. The changes will apply to the majority of AMP managed funds, including funds within the AMP KiwiSaver Scheme and New Zealand Retirement Trust (NZRT).
AMP Wealth Management highlights:
- AMP Wealth Management has been a default KiwiSaver provider since 2007.
- $6.2 billion invested in the AMP KiwiSaver Scheme on behalf of 218,789 members (as at 30 September 2020).
- 8.9% KiwiSaver market share and 4th largest KiwiSaver provider based on funds under management (as at 30 June 2020).
- 4,891 AMP KiwiSaver Scheme Default Fund members were moved into a fund better suited to their needs (since 1 October 2019).
- 2,171 AMP KiwiSaver Scheme members withdrew $65.8 million to help buy their first home (since 1 October 2019).
- AMP KiwiSaver Scheme members withdrew $110.2 million to help fund their retirement (since 1 October 2019).
- $3.42 billion invested in NZRT on behalf of 37,828 members (as at 30 September 2020).
- 45% corporate superannuation market share based on NZRT funds under management (as at 30 June 2020).
BlackRock is a global leader in investment management:
BlackRock’s purpose is to help more and more people experience financial well-being. As a fiduciary to investors and a leading provider of financial technology, their clients turn to them for the solutions they need when planning for their most important goals. As of 30 September 2020, the firm managed approximately USD$7.81 trillion in assets on behalf of investors worldwide. For additional information on BlackRock, visit www.blackrock.com/corporate.