Bank-owned superannuation funds are losing billions to industry funds a response of customers in response to their misbehavior that has been revealed at the banking royal commission.
AustralianSuper says it received more than $1 billion from new customers in each of July and August – double the amount of the same time last year.
Chief investment officer Mark Delaney said the gains were due to transfers out of retail funds.
"We can see where the money is coming from," he told Fairfax Media. "It's money being rolled in and it's coming from retail providers."
With more than $140 billion in funds under management, AustralianSuper is already the nation's largest super fund.
In the June quarter, the value of industry funds surpassed retail funds for the first time; the sectors hold $632 billion and $622 billion respectively.
It appears while industry super executives were called before the royal commission they emerged largely unscathed.
Hostplus was found to have fallen below community standards when it sought to keep low-balance members in the fund.
Hostplus had been riding a wave of popularity generated by author Scott Pape, better known as The Barefoot Investor.
The Hayne royal commission gave industry super funds a surprisingly "cursory" examination, says former union boss Paul Howes.
KPMG wealth chief and former union boss Paul Howes told Fairfax Media he was surprised at "the significant amount of time that was dedicated to retail funds versus quite a cursory amount of time on industry funds."
Howes said consolidation of industry funds was the most important issue faced by the super sector and yet the commission spent comparatively little time exploring it.
"We have 238 APRA-regulated funds in a country of 25 million people," he said.
"It is insane, and it is an indictment on our sector and the regulator that so many exist.
"What also surprised me was the lack of focus on returns," he said.
"I felt they talked a lot about fees ... transparency and disclosures, but ultimately the $2.7 trillion question for the sector is about returns. It was almost like the elephant in the room that was never mentioned."
