Changes, changes, changes

Friday, November 14th 2008, 12:23PM

Change could be the word of the week. The obvious big change this week has been with the government. But I sense there is a heap of changes coming for the funds management and advisory industry too. For years we have written about and commented on “consolidation” in the industry – however it has often failed to eventuate. Four stories on Good Returns this week all pointed to change. First up we have a new cornerstone shareholder at Fisher Funds Management. (Our updated story on this is here). Then today two of the founders of Brook Asset Management said they were moving on. Added to that FNZ is trying to sell its wrap business, which could provide more change. While no buyers have been publicly identified, a couple which have been mentioned in dispatches are AMP (it doesn’t have a wrap service in Australia or New Zealand) and AXA. Who knows what will happen, but considering a lot of competitors use the service, one can guess that a sale could lead to more changes. Then we have the Reserve Bank talking about consolidation of finance companies, even suggesting that some of the assets or businesses in trouble at the moment could be acquired by some of the stronger companies. On the face of it this makes for an interesting development, and I guess potentially good for clients of struggling companies. Then if we are looking for more changes our new government is likely to make KiwiSaver a different beast from what it is. This means more work for most involved including employers. This is one of the things which I hope we would avoid with KiwiSaver, having lots of changes. It has plagued the Australian system and seemed to be something New Zealand should avoid. Unfortunately that lesson hasn’t been learnt. And I guess when the government next changes there will be more tinkering with KiwiSaver.

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