Queensland Investment Corp., which manages about $59 billion in assets, has shut a unit that seeks to protect superannuation fund members’ balances because of its poor capital raising prospects due to a perceived delay in the implementation of MySuper.
QIC closed its lifecycle strategies unit on December 2, says Adriaan Ryder, managing director of QIC’s strategy boutique. The unit was considered a boutique. It was started in February, 2010 and had not raised any capital.
“The initiative of having a whole team focused on pre-retirement strategies wasn’t going to work out,” says Ryder. “The feedback is that most funds aren’t prepared to go down this route until they’ve got absolute clarity around MySuper.”
The start of MySuper may be delayed beyond July 2013 because of the increasing workload of the Parliamentary Joint Committee on Corporations and Financial Services, according to the Association of Superannuation Funds of Australia. The legislation was previously expected to pass at the end of this year.
Professor Michael Drew, who was managing director of the so-called lifecycle strategies boutique, has left to return to Griffith University to teach.
Adam Walk, head of research in the boutique, has also left QIC. Drew will supervise Walk’s doctorate. Evan Reedman, who was a director of the boutique, has also left QIC.
QIC will now focus on raising assets for “post-retirement” investment strategies through its strategy boutique, Ryder says.
Post-retirement strategies typically aim to derive income instead of capital growth from equity and bond markets. QIC’s strategy boutique employs 23 people and manages about $35 billion in assets.