$5b wiped off KiwiSaver in three months

AUCKLAND: The total value of New Zealanders’ KiwiSaver assets fell $4.95 billion in the three months to June 30, bringing it down to $82.77 billion, Morningstar figures show.

And the value is nearly $10 billion down on the $91.67 billion the superannuation scheme hit in December last year before markets turned down.

Tim Murphy, director of manager selection AsiaPacific with Morningstar, said world markets had been hit this year.

‘‘During the second quarter of this year, global GDP contracted, due to slowdowns in China and Russia, while US household spending fell short of expectations.

‘‘Several shocks have rocked a global economy already weakened by the pandemic: higher than expected inflation around the world, particularly in the US and major European economies, causing financial conditions to tighten; a worse than expected slowdown in China, due to the Covid19 outbreaks and lockdowns, and further negative fallout from the war in Ukraine.’’

New Zealand’s benchmark index the S&P/NZX 50 fell 10.2% over the quarter with large companies such as Fletcher Building and Fisher and Paykel Healthcare falling sharply, down 21% and 16.8% respectively.

Australia’s stock market also performed poorly, down 9.7%, while the MSCI World Index was down 6.2%.

It was also bad news on the bond front with international fixed interest delivering large losses due to bond yields climbing. The average return for conservative KiwiSaver funds was 4.2%, while balanced funds averaged 7.1% and growth funds were down 9%.

Aggressive funds took the biggest hit, falling on average 10.1% over the quarter.

Mr Murphy said it was most appropriate to look at KiwiSaver fund performance over the longer term.

Over 10 years the aggressive fund category has averaged an annual return of 9.3% followed by

growth at 9%, balanced at 7.3% and growth at 4.5%.

ANZ remains the largest provider with $17.2 billion but it continues to lose market share, falling to 20.7% and down from 21% in December 2021 and 24.1% in December 2019.

ASB is the second largest with $13.3 billion and a 16% market share — slightly up on the 15.8% it had in December 2021 but well down on its 18.4% share in December 2019.

Westpac is the thirdlargest provider with $8.8 billion.