Wanted: Credit Experts for $29 Billion Fund in AustraliaBy and
CBUS looks to boost credit, infrastructure and property teams
Fund receives A$1.75 billion in new contributions each year
An Australian pension fund overseeing A$37 billion ($29 billion) in assets is looking to hire investment staff to bolster its credit, infrastructure and property teams as it diversifies away from Australian equities.
Melbourne-based Construction & Building Unions Superannuation, which managed Australia’s second-best performing pension strategy in 2016, aims to bring more of its asset management in-house. It joins the nation’s biggest pension fund, the A$100 billion AustralianSuper Pty, and UniSuper Management Pty, in growing their internal investment businesses.
“We want to make sure we have capacity to cover a broader part of the market,” Kristian Fok, executive manager, investment strategy at CBUS, said in Sydney. “We’re hiring for capabilities in Sydney and Melbourne.”
The hiring plans, still subject to approval, come as investors across Australia’s A$2.2 trillion pension pool comb for new ways to cut costs and beef up returns amid low yields. The industry regulator has encouraged mergers, which have contributed to an 82 percent drop in the number of funds in the world’s fourth-largest pension market over the decade to June last year, according to data compiled by SuperRatings Pty.
CBUS, which primarily manages the retirement assets of construction and building workers, receives A$1.75 billion in new pension contributions each year from more than 741,000 Australians. Its default “growth” investment option was named Australia’s second-best performing pension strategy for the year to Dec. 31 after gaining 9.6 percent in the period, SuperRatings data show.
Around 45 percent of the fund is invested in equities, with nearly 25 percent in Australian shares, according to Fok. The hiring drive will aid its strategy to better diversify assets. “We acknowledge that still within the portfolio there’s quite a bias towards equities,” Fok said.
The company is considering hiring investment personnel to support Linda Cunningham, who was appointed manager of debt last October, and Diana Callebaut, manager of infrastructure at CBUS, Fok said. It is also weighing adding more staff to its property, and investment strategy and innovation teams, he said.
The pension fund is also considering investing in “affordable housing” as it seeks to play a role in easing the nation’s property affordability woes, according to Fok. Callebaut says the Australian government needs to “take leadership” on housing affordability issues and CBUS wants to be “part of the solution.”
CBUS expects to have 30 investment staff in Fok’s team by June 30, double the 15 people from the same time last year.
“A number of the hires are just about incrementally adding to resources to the strategies that have already been approved,” he said.