Credit Suisse Asset Management (CSAM) began the final wind-down phase of its ill-fated MasterWrap last week with the decision to transfer $300 million to badged Oasis platform Wealthtrac.
Since its launch in August 2004 the MasterWrap platform – the brainchild of Brian Thomas, former CSAM head of distribution – has garnered only $130 million. However, CSAM will also transfer $170 million of its direct super rollover and allocated pension funds to Wealthtrac. According to Keith Ince, CSAM head of asset management in Australia, about 4,000 clients will be affected by the move as well as 1,000 financial advisers who were using MasterWrap. “MasterWrap never lived up to its overall expectations – it needed a great amount of money spent on it to make it viable,” Ince said. “The wrap was not a core part of our business – we want to focus on being an asset manager.” As well as the fund transfer to Wealthtrac, CSAM has also dismantled the straight-through processing technology and other front-end financial planning tools that were a key selling point of MasterWrap. “We never owned the technology but we have ended our agreements with IWL and other external providers,” Ince said. It is understood CSAM spent at least $5 million developing MasterWrap’s straight-through processing technology in association with IWL and InfoComp. However, Ince said Wealthtrac was a worthy successor fund and will offer clients a wider choice of funds than previously at a comparable level of fees. Matthew Johnson, Wealthtrac head of distribution, said the $300 million will almost double the platform’s funds under administration, which currently stands at $380 million. Oasis, which provides the technology behind Wealthtrac, was recently bought by ING. Johnson said Wealthtrac has 220 investment products plus an ASX/S&P 100 direct shares option while the CSAM MasterWrap had 120 investment options and no direct share option. “We see further strength in terms of access to advisers,” Johnson said. Ince said “no money changed hands” for the transfer to Wealthtrac, which is expected to be completed by the end of October. Ince said CSAM still has $1 billion of retail money and plans to roll out a range of alternative products shortly.
AustralianSuper’s appointment of a general manager, retirement to replace Shawn Blackmore, which follows ART's redeployment of Kathy Vincent to chief operating officer, shows that mega funds are back-pedalling on the strategy of having dedicated retirement C-suite executives. The role had been touted as the next big thing in super funds' organisational structures, but experts say what matters is there is senior accountability for decumulation.
Darcy SongDecember 4, 2024
