Savings industry let Kiwis down: Stewart

AXA chief executive Ralph Stewart has fronted up and admitted the savings industry and the government betrayed New Zealanders over the years.

Tuesday, March 9th 2010, 7:38AM

In a new book, Crisis to Confidence, Stewart describes the investment industry's behaviour as corporate betrayal.

He says that "the combination of corporate failure, poor regulation and the inability to recognise the importance of national savings has robbed New Zealanders of the opportunity to become financially self-reliant."

Blame should lie with successive governments who have failed to promote the development of a strong domestic financial services industry supported by a clear domestic savings policy.

Stewart details the evolution of the financial advisory industry in the book and says that it has failed because of the lack of standards and the decision by the government to allow it to be self-regulating.

Although he doesn't name them he refers to the failure of ING's CDO-backed investment products and criticism of Money Managers as examples where the industry has suffered.

"The advisory industry has failed New Zealand savers and investors in the same way as corporate investment houses, failing to strikes the right balance between the benefits for investors and the benefits for the business owners."

Crisis to Confidence is written AXA executives, including from its funds management business and advisers.

While Stewart's chapter is devoted to the state of the industry other chapters explain what led to the global financial crisis and discuss investment issues.

Crisis to Confidence is available at www.intelligentinvestor.co.nz or by calling 0800-345675.

http://www.intelligentinvestor.co.nz/products/From-Crisis-to-Confidence.html

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