Despite allegations of misconduct against KKR, the private equity firm who acquired 55% of Colonial First State (CFS) from the Commonwealth Bank (CBA), the bank believes the partnership with KKR will bring significant benefits to its superannuation members.
Answering a question on notice, CBA said it considered KKR as a future shareholder and the benefits KKR could offer CFS and its members were significant investments.
The question from Labor’s Andrew Leigh pointed to:
The answer from CBA said: “CBA believes the KKR partnership will bring significant member benefits through a commitment to invest in a range of transformation initiatives including:
CBA also said it undertook its standard “buyer due diligence procedures” prior to the transaction including Anti-Bribery and Corruption, Know Your Customer/Anti-Money Laundering and Economic Trade and Sanctions checks.
“The superannuation funds within Colonial First State are managed by a trustee with a majority independent board whose primary duty is to members of its fund. All super funds in Australia are strictly regulated under the Superannuation Industry (Supervision) Act.”
The two funds have announced the signing of a non-binding MOU to explore a potential merger.
The board must shift its focus from managing inflation to stimulating the economy with the trimmed mean inflation figure edging closer to the 2.5 per cent target, economists have said.
ASIC chair Joe Longo says superannuation trustees must do more to protect members from misconduct and high-risk schemes.
Super fund mergers are rising, but poor planning during successor fund transfers has left members and employers exposed to serious risks.