{"id":95352,"date":"2025-10-23T00:21:23","date_gmt":"2025-10-23T00:21:23","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/95352\/"},"modified":"2025-10-23T00:21:23","modified_gmt":"2025-10-23T00:21:23","slug":"kiwisaver-turns-18-assets-climb-5b-to-nearly-135b","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/95352\/","title":{"rendered":"KiwiSaver turns 18, assets climb $5b to nearly $135b"},"content":{"rendered":"
\u201cWe have our first $1 billion default fund, and more on the way,\u201d Bunkall said.<\/p>\n
KiwiSaver assets on the Morningstar database rose strongly during the June quarter to 135b.<\/p>\n
ASB had a strong quarter with three of its funds at the top of their category and the other two multi-asset funds in the top five performers.<\/p>\n
Other than ASB, no provider consistently has funds at the top of the category, although a couple of Kernel\u2019s low-cost multi-asset funds had some strong showings, Morningstar said.<\/p>\n
ANZ leads the market share with almost $23b.<\/p>\n
ASB is in second position, with a market share of 14.9%.<\/p>\n
Then goes Fisher. Milford and Westpac round out the big five.<\/p>\n
The five largest KiwiSaver providers account for about 66% of assets in the Morningstar database, or around $88b under management.<\/p>\n
\u201cWe estimate that KiwiSaver providers will charge more than $1.1b from KiwiSaver members in the next 12 months to manage their KiwiSaver funds, at an average fee of around 0.82 of a cent per dollar invested,\u201d Bunkall said.<\/p>\n
KiwiSaver performances needed to be evaluated over the long term.<\/p>\n
Over 10 years, the aggressive category average has given investors an annualised return of 10.0%, followed by growth (8.3%), balanced (6.8%), moderate (4.1%), and conservative (3.4%), Morningstar said.<\/p>\n
In its market commentary, Morningstar said the September quarter marked another constructive period for diversified investors. <\/p>\n
Inflation pressures continued to ease, major central banks extended their rate-cutting cycles, and risk assets performed well. <\/p>\n
Domestically, the Reserve Bank of New Zealand maintained its gradual easing stance that began in August 2024, while the NZ dollar traded in a relatively tight range against the US dollar.<\/p>\n
Short-term interest rates declined modestly over the quarter as the effects of earlier official cash rate cuts flowed through to retail deposit markets. <\/p>\n
Term-deposit and call-account rates have rolled off mid-2024 peaks.<\/p>\n
\u201cCash continues to provide valuable liquidity, but its yield advantage is narrowing as monetary policy normalises,\u201d Morningstar said.<\/p>\n
Local bond markets delivered positive returns as yields declined across the curve.<\/p>\n
Softer inflation data and confidence that policy settings are moving toward neutral supported demand for duration. <\/p>\n
Ten-year government yields ended the quarter near 4.2%, down from mid-year levels.<\/p>\n
\u201cWith inflation expectations contained and further incremental easing likely, the backdrop for core fixed income remains supportive,\u201c Morningstar said.<\/p>\n
New Zealand equities<\/p>\n
The domestic equity market posted modest gains through the quarter. <\/p>\n
Rate-sensitive and income-oriented sectors benefited from the ongoing easing bias, while defensives held firm. <\/p>\n
Export-exposed companies gained some tailwind from currency stability. <\/p>\n
\u201cAlthough earnings growth remains uneven, sentiment improved compared with the first half of the year,\u201d it said.<\/p>\n
Australian equities <\/p>\n
Australian shares continued to outperform New Zealand peers, led by strong contributions from banks, healthcare, and selective resource exposures. <\/p>\n
The Reserve Bank of Australia held rates steady, underpinning investor confidence.<\/p>\n
For unhedged New Zealand investors, mild exchange-rate moves had only a marginal effect on overall returns. <\/p>\n
International equities <\/p>\n
Global equities advanced as the US Federal Reserve delivered its first rate cut in September 2025, reinforcing confidence in a soft-landing scenario.<\/p>\n
Technology, industrials, and European luxury sectors led performance, while Asia ex-Japan benefited from renewed investor interest, Morningstar said.<\/p>\n
Hedged global portfolios recorded solid gains, and unhedged exposures were broadly neutral given limited currency movement, it said.<\/p>\n
Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector and energy. He joined the Herald in 2011.<\/p>\n