Australian pension funds in merger talks to form country's second largest
By Paulina Duran
SYDNEY, April 5 (Reuters) - First State Super and VicSuper
are in merger talks to create Australia's second largest pension
fund, they said on Thursday, as the industry faces regulatory
pressure to improve standards and accountability.
The new superannuation, or retirement, fund, would have
about A$110 billion ($78.21 billion) in assets under management
servicing over 1.1 million workers, the nonprofit funds said in
separate statements. AustralianSuper is the largest, managing
"The opportunity to achieve greater scale through a merger
like this could help us create even better member outcomes
through superior services and broader investment opportunities,
delivering strong, sustainable investment returns," First State
Super said on its website.
An ongoing quasi-judicial inquiry into Australia's financial
sector has found that some fund managers within the country's
compulsory A$2.7 trillion pension system may not be putting
customers' interests ahead of their own.
Australia plans to begin publishing "heat maps" of the
performance of pension funds next year and pressure those with
poor records to exit the industry.
The enhanced regulatory scrutiny is expected to trigger a
wave of industry mergers.
First Super and VicSuper said the talks were exploratory and
that no final decision had been made.
($1 = 1.4065 Australian dollars)
(Reporting by Paulina Duran; Editing by Richard Chang)
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