NGS Super and Australian Catholic Super have called off a merger a week after the prudential regulator outlined new protocols relating to how merging funds can and can’t use their respective performance histories in the context of the new performance test.
In a statement on Wednesday NGS Super chair Dick Shearman pointed to the rapidly changing regulatory and commercial environment as the reason why NGS decided the merger would be in members’ best financial interest.
“A merger must deliver real financial benefits to members, and we are disappointed that this could not be achieved in a merger with Australian Catholic Super,” Shearman said.
In mid-August APRA came out with guidance on how track records can and can’t be combined, a major consideration under the Your Future, Your Super performance test.
Funds won’t be able to change the structure of their products, merge or consolidate products together and expect the performance to be recognised under the new laws.
In its information paper APRA outlined it would look for funds to retain continuity of control, continuity of product design and will be keeping an eye on members impacted as funds are brought together.
The NGS and Australian Catholic Super’s statements noted the funds had spent 12 months thoroughly and extensively investigating the opportunity to merge the two funds.
