APRA warns of super fund challenges

New insights from APRA show 45% of super funds have experienced a decline in member accounts, facing pressure to increase costs to members as other members exit through rollovers or hit preservation age and withdraw their balance as a lump sum.

- Jamie Williamson

The funds showing some of the steepest declines in account growth include Challenger Retirement Fund, Perpetual's WealthFocus, AMP Super Fund, and MLC Super Fund.

Over the last three years, the number of member accounts industry-wide has grown, largely on the back of employment growth and the removal of the $450 monthly super guarantee threshold. However, much of this growth has been enjoyed by the largest 15 funds. According to APRA, these funds have seen their market share increase from 69% to 78% in the last five years.

The top five funds by assets have increased their market share through higher SG contributions flows and member account growth faster than their relative share of net assets. Their growth in the past five years of market share by member accounts is 20% and 18% by SG contributions.