June flows surge ahead of super caps

Data from Strategic Insights has confirmed net flows more than doubled to $10.5 billion in June ahead of the introduction of lower super contribution caps from 1 July 2017.

AMP won the highest share of super flows (including roll-overs) of 19 per cent, only slightly below its 26 per cent super funds under management market share, according to Strategic Insights.

“This is AMP's equal best performance by market share in 5.5 years and is a marked turnaround from the six-year average of a negative 7 per cent share," according to Citi.

Total super net flows almost tripled to $12.1 billion in the June quarter compared to the year ago same quarter as savers rushed to take advantage of the last opportunity to make higher contributions before more stringent rules kick in from 1 July, and as balances above the new $1.6 million cap is transferred to the accumulation phase.

Commonwealth Bank’s Colonial First Sate and BT also saw net inflows of more than $1 billion.

Bigger the better

Retirement income products net outflows accelerated rapidly to $6.0 billion in the June quarter from $1.2bn in March 17. This was the biggest net outflow ever recorded and reflects the implementation of the government's new $1.6 million cap on super in the retirement phase.

"It seems likely that a large portion of this $6 billion outflow was transferred to the accumulation phase, showing up in the $12 billion super net inflows. AMP's share of retirement income net outflows was the same as its share of superannuation net inflows at 22 per cent, leading to just an 11 per cent market share of overall net flows on the marketer's view.”

Bigger players performed better, but independents were still strong with Netwealth leading the charge. However, according to Citi, the larger players seem to have performed better in June 2017 than in recent quarters, with Macquarie in second place with 15 per cent share and Colonial/CBA, BT and AMP attracting 11 per cent each.

Hub24 attracted 8 per cent of flows, well above its FUM market share of 0.7 per cent. The total FUM market share of Hub24 and Netwealth of 2.3 per cent has almost doubled from just two years ago.

Wholesale flows remain volatile quarter to quarter, with June 2017 net flows swelling to $8.0 billion compared to just $0.6 billoin for the previous June quarter. Rolling 12 month net flows are $3.3 billoin or 1.5 per cent of starting FUM.

Citi analysts noted discretionary flows are likely to be subdued in the September 2017 quarter following the pull-forward in June.

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