NAB today announced that it has streamlined its superannuation business, merging five of its super funds into one – and, in doing so, creating Australia’s largest retail super fund. The fund is named the MLC Super Fund.
In October 2015, NAB announced that it is entering into a long term partnership with Nippon Life to create a stand-alone life insurance business. The establishment of this business requires the life business to be structurally separated from the superannuation and investments business, which NAB is retaining. As part of this process, NAB is also simplifying the structure of its superannuation business.
NAB Wealth Group Executive and CEO of MLC, Andrew Hagger explained that one of the key benefits to simplifying our superannuation fund structure is to improve the customer experience.
“At NAB, we want to deliver a great customer experience.
“Our old superannuation structure has served our customers well, but as we look forward, we want to innovate more.
“Now that we’ve created Australia’s largest retail super fund, we’ll be looking to find new ways to make it easier for our customers to engage with us as they create and protect their wealth, and save for their retirement,” Mr Hagger said.
NAB Superannuation and Investment Platforms, Executive General Manager, Paul Carter, explained the MLC Super Fund will manage superannuation and retirement needs for more than a million Australians, and will have approximately $70 billion in funds under management. The fund includes NAB’s two main super offerings, being the MLC MasterKey and Plum superannuation and pension offerings.
“The MLC Super Fund is a welcome development for customers. This consolidation of our super funds will, over time, make it easier for customers to move between various products and features within the fund as their needs change throughout their life.
“This work is strategically important and lays the groundwork for our planned $300 million investment across our wealth activities in new wealth products and services for our customers and financial advisers.
“This $300 million investment will help us deliver an even better customer and adviser experience through digital innovation, product and platform enhancement, and making it simple to navigate our products,” Mr Carter said.
“This is the largest organic investment we have made into our wealth business over the last 15 years. We want to build new wealth products where our customers feel supported, their experience is personalised and it is easy for them to do business with us,” Mr Hagger said.
NAB has written to approximately 1.3 million members informing them of the move and explaining the changes.
The merger process was subject to various trustee and regulatory approvals.
Background for editors –
On 28 October 2015, NAB announced it had entered into an agreement to sell 80% of NAB’s life insurance manufacturing business to Nippon Life Insurance Company (Nippon Life), while NAB will retain the remaining 20%. NAB retains our existing ownership of our investments businesses, including super, platforms, advice and asset management. NAB will continue to own and use the MLC brand in providing super, investments, advice and life insurance to customers. Nippon Life will have a 10 year license agreement to use the MLC brand for life insurance. The transaction is expected to be completed by the second half of calendar 2016 subject to certain conditions including regulatory approvals.
The sale of the life insurance manufacturing business requires the structural separation of the life insurance manufacturing business from our superannuation and investments business to create a standalone life insurance business. Before the consolidation of the super funds announced today, within the NAB Group there were eight superannuation funds under three Trustees. As part of this consolidation, two Trustees moved their members from their existing funds into one new fund called the MLC Super Fund, under the governance of the remaining Trustee, NULIS Nominees (Australia) Limited.
Based on APRA’s most recent publicly available statistics issued on 10 February 2016, the new MLC Super Fund is Australia’s largest retail super fund, and the second largest fund in Australia’s superannuation sector.
Also on 28 October 2015, NAB announced that it would invest at least $300 million in NAB Wealth in our superannuation, platforms, advice and asset management business.
