Ms Joslin, Fund Manager of the AMP Capital Diversified Property Fund (ADPF), will retire mid-2015 after a 34-year career in the property industry including 20 years at AMP Capital. An internal and external recruitment process has commenced and once a replacement is appointed, Ms Joslin will work with her successor to effect a seamless transition.

Joining in 1995, Ms Joslin’s time with AMP Capital includes nine years as Fund Manager of the flagship Australian Core Property Portfolio and in late 2014 she was integral to the acquisition of $4 billion of assets by ADPF and a successful capital raising by the Fund. Ms Joslin is also a former Director and NSW President of the Property Council of Australia.

AMP Capital Head of Property Funds Management Chris Judd paid tribute to the significant contribution Ms Joslin has made to the business.

“Over the years, Louise has delivered time and again for our investors and our business, always with a high standard of excellence, a dedicated focus on performance, and an unshakeable commitment to governance and integrity.”

Mr Judd said that ADPF’s new Fund Manager, with the support of Senior Property Fund Analyst Julian Menegazzo and the broad capability of the AMP Capital Property Team, will continue working together to provide investors with consistent investment returns over the long term.

“We are commited to ensuring ADPF realises its full potential and the AMP Capital Property Team is looking forward to ensuring the portfolio’s assets are well positioned for future performance,” Mr Judd continued.

One of the largest, unlisted property funds in the country, ADPF has total assets of $4 billion and currently comprises 18 high quality assets across the Australian office, retail and industrial property sectors, as well as units in the AMP Capital Shopping Centre Fund and AMP Capital Wholesale Office Fund. This includes the newly-developed Macquarie Centre in Sydney, Pacific Fair on Queensland’s Gold Coast, which is currently undergoing significant re-development, and potential developments at Garden City Booragoon in Western Australia and Quay Quarter Sydney.

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Lee Barnett

AMP Limited yesterday announced that Ms Lee Barnett will retire as Chief Information Officer after 18 years of service, including 12 years in her existing role.

Ms Barnett will be replaced by Craig Ryman, AMP’s current IT Director Product & Advice.

AMP Chief Executive Officer Craig Meller acknowledged Lee’s substantial contribution to the company since joining AMP in 1996. She has lead AMP’s IT and Project Services as well as Sourcing and Facilities Management functions through a period of considerable industry change and overseen the technology integration of AXA’s Australian and New Zealand businesses as well as the demerger of AMP’s UK business.

“Lee Barnett has been instrumental in helping to shape AMP’s transformation of our core Australian business. This embraces our ongoing customer driven focus and cements our position as the leading independent wealth management company in Australia and New Zealand,” Mr Meller said. “We wish her well.”

Mr Meller said he welcomed Mr Ryman’s appointment as Chief Information Officer at a time when AMP was transforming its core Australian business with new operating model and mobile platforms. These were announced at the group’s half-year financial results in August.

Mr Ryman will start in his new role in 1 January 2015.

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Mark Rantall

The 14^th annual Financial Planning Week (FP Week) wrapped up this week, and has revealed that Australians are most concerned about retirement, home loans, superannuation and the best way to invest their hard earned savings.

The results of the campaign, run by the Financial Planning Association of Australia (FPA), have also shown that Australians aged between 20 and 35, are particularly interested in ‘quick fix’ tips to help them get ahead and make the most of any surplus income before they incur long-term debt.

Not surprisingly, people aged 50+ were the most engaged in FP Week, seeking out content that explained how they can prepare for retirement and also maximise retirement income.

Mark Rantall, CEO of the FPA, reflected on the campaign: “The aim of FP Week has always been to show the value of advice and demonstrate to Australians that qualified, professional advice can help secure their financial future and also help with short term goals.

“The financial planning profession has been in the spotlight recently, and education announcements made during FP Week by large financial institutions are another win for consumers because they will ultimately result in better protection and quality of advice. When people go and see a planner, they have a right to trust the person they see.”

One way the FPA seeks to demonstrate the benefits of good advice is through its Ask an Expert forum, Run by the FPA during its annual FP Week and Ask an Expert campaigns, Ask an Expert is a free service that allows people to submit a question about their finances to an FPA member.

“Over 20,000 people viewed our Ask an Expert forum this year, a 100% increase when compared to last year’s campaign, which shows there is a growing appetite and awareness of advice in Australia.

“As well as encouraging people to use this service, we also ran a consumer blog throughout FP Week that focused on different demographic groups and provided targeted and relevant content for each.

“Based on the visitor traffic to our blog, we can see that the piece about getting ahead in your 20s and 30s was most popular. Often we assume that people that fit into this demographic aren’t actively looking to manage their finances but FP Week has revealed that their appetite for advice isn’t much different from the retirement age group,” Mr Rantall explained.

Nearly 7,000 people viewed the FPA’s Find a Planner directory during FP Week to search for a qualified financial planner in their area.

“For 14 years, the goal of FP Week has been to show Australians the positive impact that qualified advice can have, and also encourage them to seek personal advice of their own. It is encouraging to see Australians using our directory to find a member of our association that can help with their finances.

“We want to thank those members who have contributed to the success of this year’s Financial Planning Week by contributing to the blog and Ask an Expert forum. We represent a community of professionals that is passionate about improving the lives of their clients through qualified financial advice, not only during FP Week, but ongoing,” Mr Rantall said.

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Wade Matterson

With a growing trend both globally and in Australia around low volatility, managed volatility, and portfolio risk management strategies, it is imperative that advisors and research consultants explore each strategy to uncover how different risks are being addressed. Identifying those techniques that are robust and able to address both diversifiable and systematic risks is likely to provide better overall results for investors and fund members.

Traditionally, portfolio construction and diversification across asset classes has been the major focus of risk management for the asset management industry. However, as the global financial crisis (GFC) highlighted, diversification alone cannot provide adequate protection in highly stressed markets. During the GFC, balanced and conservative portfolios experienced significant drawdowns, with some falling by more than 25%. This acutely highlighted the Risk Tolerance Paradox faced by investors approaching and entering retirement: Risk levels expected by investors over the long term are rarely the same as the risk levels they experience over shorter periods.

Historically, the industry’s preferred approach to overcoming portfolio volatility and large portfolio losses has been to stay invested, ride out the storm, average down, keep investing, and eventually growth will return and damage to the portfolio will be repaired. While this still holds true for the young, who have substantial time left before retirement, it may not be practical or realistic for those near retirement or already retired. As demonstrated during the depths of the GFC, many fund members acted against these principles and realised losses at the worst possible time.

The other traditional answer for those near or in retirement has been to de-risk the portfolio by reducing exposures to growth assets — an approach which has been reflected in the increased adoption of life cycle strategies. However, as retirees live longer and interest rates remain at historically low levels, life cycle or annuity solutions may lock in low levels of income or create a higher likelihood of exhausting savings early in retirement. Given current global market conditions and increases in average life expectancies, the answer will most probably include an element of continued exposure to growth, albeit with some explicit ‘managed risk’ or ‘managed volatility’ approach.

Wade Matterson of Milliman Australia stated: ‘With large demographic shifts well underway in the developed world, including Australia, investment strategies focused upon retirement are starting to resonate with local industry and retail funds. The growing issues of balancing longevity risk with the risk of permanent capital loss have continued to grow in importance for most of our clients.

‘Following several years of preoccupation with FOFA and MySuper, we have begun to see a strong increase in demand for retirement solutions that address key issues around risk management and retirement.

‘Our work with Plato Investment Management, who recently launched a Managed Risk Income Fund and Maritime Super, highlights the momentum that is building in the industry and the increased appetite to create solutions which address some of these issues.’

In a new Risk Tolerance Paradox paper published by Milliman, we explore the main reason for this paradox, and introduce a risk management strategy that seeks to solve the problem.

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Ben Davis

Zenith Associate Director and Manager of Zenith’s Retirement Portfolio Solutions, Ben Davis has announced the release of a range of six investment solutions designed to maximise income and age pension entitlements, protect capital and reduce investment risk to meet the lifelong income needs of retirees.

Davis confirmed that Retirement Portfolios had been developed in response to the growth in the Australian retiree sector and subsequent demand for dedicated portfolios for those people in retirement and builds on Zenith’s acknowledged model portfolios development strengths and expertise.

The population ‘bulge’ of the Baby Boomer / retirement age group is here and represents an unprecedented advice and business opportunity for financial advisers. In addition, age based defaults in corporate superannuation funds are growing quickly.

Commenting further Davis said, “Zenith’s Retirement Portfolio Solutions provides advisers the ability to construct dedicated and personalised retirement portfolios within existing compliance and Professional Indemnity insurance frameworks”.

“Within the six implementable Retirement Models, retirees will be provided with options to address the requirements of high net worth investors as well as age pension eligible investors. In addition, the portfolios are offered with or without the inclusion of an Annuity product option, which, in turn, can potentially further enhance pension benefits”.

Zenith’s six Portfolio options provide the following solutions for high net worth investor retirees through to age pension eligible investors:

• Retirement Defensive
• Retirement Core
• Retirement Growth
• Annuities + Retirement Defensive
• Annuities + Retirement Core
• Annuities + Retirement Growth

The Zenith models provide a retiree the potential to optimise pension benefits and achieve greater capital stability/security, income certainty, liquidity while at the same time reducing costs.

Furthermore, the portfolio solutions address key retiree considerations:

• For most retirees, the interaction of their portfolio with the aged pension is critical
• Retirees strongly dislike drawing down on capital and prefer the portfolio to generate income they can live off
• Retirees have an asymmetric return profile and are hyper sensitive to losses and may give up some upside for security

Davis believes that “Zenith’s continuing commitment to delivering high quality models, and transparent ‘look through’ portfolio holdings and characteristics reporting to the adviser market” makes the delivery of a specific set of Retirement Models the next logical progression in an ever growing market section – the Australian retiree market. A solution that we believe has not been adequately provided for in the past, and once again, signifies a continuing commitment by Zenith to provide new portfolio solutions when we see a need.

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The Board has appointed Andrew Thorburn as Group Chief Executive Officer and Managing Director, effective 1 August 2014, and he will be invited to join the NAB Board at this time. His appointment is subject to regulatory approvals.

Mr Clyne said leading more than 42,000 NAB employees and strengthening the culture and reputation of the organisation was the most rewarding role of his career. But he said the job had taken a personal toll and it was now time to retire from executive life.

“We have built a strong foundation for future growth with the revitalisation of the Personal Bank, grown our already strong position in business banking, and achieved material improvements in customer satisfaction and reputation. We have also worked methodically through our legacy issues while still making transformational change in our technology,” Mr Clyne said.

“I am leaving to spend some much-needed time with my young family. I am proud that I leave NAB as a strong, customer-focused bank.”

Mr Chaney paid tribute to the exceptional leadership of Cameron Clyne and said Cameron had advised the Board of his desire to retire from executive roles.

“Cameron took over as CEO during the global financial crisis and developed an effective strategy to steer the Bank through a challenging period during which it has undergone significant cultural and structural change,” Mr Chaney said.

“He is highly regarded throughout the Bank and externally, and we are sorry to see him leave at this time. Cameron has built strong leadership across the organisation, a stronger balance sheet, improved the Bank’s culture, enhanced its reputation and dealt with a number of legacy issues.”

“As a result of his efforts, NAB is well positioned for the future.”

Mr Chaney said he was pleased that the company’s succession planning processes had enabled the Board to choose someone from within the organisation who has the ability and the vision to take on the role of CEO of the Group.

He described Andrew Thorburn as an outstanding banking executive who has been part of the NAB Group Executive team that developed the Bank’s successful strategy focusing on building a stronger Australian and NZ franchise.

“Andrew Thorburn has done a superb job leading Bank of New Zealand (BNZ) since 2008 where he continued to build the bank’s performance, increasing cash earnings by more than 40 per cent, improving market share on the back of strong customer satisfaction and developing a strong leadership culture. As CEO of BNZ, Andrew has gained extensive experience in all of the component parts of running a full service commercial bank. BNZ has delivered consistently strong results, reflecting a focused and disciplined approach to implementation of the strategy. In the course of his time at the Bank, Andrew has also had responsibility for NAB’s Asian and US operations. As a member of the Group Executive team, his energy, vision and ability to motivate employees have been obvious as has his business acumen,” Mr Chaney said.

Before being appointed CEO of BNZ in 2008, Andrew was Executive General Manager, Retail Banking at NAB for three years. He is a career banker who has spent more than 27 years working in the industry in Australia and NZ.

A replacement for Andrew as Managing Director and CEO of BNZ will be announced in due course.

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AMP also announced that Mr Simon McKeon AO will become the Chairman of the AMP Limited Board in May following the planned retirement of Peter Mason.

Simon McKeon joined the AMP Limited Board in 2013. He is a member of the Audit Committee and a Director of AMP Capital Holdings Limited. He is also the Chairman of CSIRO and holds a number of not-for-profit directorships.

The Board of AMP Limited thanked Mr Mason for his outstanding contribution to AMP over the last decade and paid tribute to his critical role overseeing a successful transition of CEO twice during his time as Chairman, his calm stewardship during the global financial crisis and the fruitful negotiations leading to the acquisition of AXA Asia Pacific Holdings Limited.

Mr Mason said: “It has been a great privilege to be the Chairman of AMP Limited, a company with a long and proud heritage that continues to make a real difference to people’s lives. During the tenure of this Board we oversaw the merger between AXA and AMP, which has delivered transformational change. The new AMP has significant scale and capacity, market-leading products and platforms, is number one in key market segments, has an expanded financial planner footprint and is well-positioned for growth.

“Succession planning has always been a key focus of the AMP Board and I am pleased that Simon McKeon will take over from me as Chairman when I step down after a full cycle of board renewal. The company and the Board are in very capable hands.”

Mr McKeon added: “Peter Mason has served and guided AMP through a successful expansion into Asia and a period of significant change in a challenging environment including the global financial crisis, substantial legislative and regulatory shifts and the merger with AXA.

“This phase of the board renewal process was timed to follow the smooth transition to the new CEO Craig Meller and the completion of the merger. We thank Mr Mason for agreeing to stay an extra year past his planned retirement date to oversee these important milestones.”

AMP Limited also advised Mr Rick Allert AO having reached the end of his three year term, has announced his intention to retire from the Boards of AMP Limited and AMP Bank Limited. Mr Allert joined the Board in 2011 following AMP’s acquisition of AXA Asia Pacific, where he was Chairman from 2000 – 2011 and a Director since 1992. The Board wishes to express its appreciation for Mr Allert’s contribution in providing continuity and insight from his deep experience in the sector.

As part of the board renewal process, AMP Limited further announced that Mr Trevor Matthews will join the AMP Limited Board as a non-executive Director, effective 3 March 2014.

Mr Matthews brings significant life insurance experience to AMP having held senior management roles in life insurance businesses in Australia and internationally over the last 30 years.

Mr Matthews is a qualified actuary who most recently was Executive Director and Chairman Developed Markets for Aviva Plc, based in London. Previously he was Chief Executive Officer, Aviva UK and has held a number of other senior executive roles with Aviva and other life insurers.

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Christine Hornery.

Many Australians may have unrealistic expectations of retirement, according to financial adviser and the Association of Financial Advisers (AFA)’s 2012 Female Excellence in Advice Award winner, Christine Hornery.

“The word retirement may conjure up a picture of relaxed lifestyle, being able to do all the things people never had the time to do while working and an emotive image of calmness and serenity,” Ms Hornery, a retirement specialist, says. “But in my experience, with some clients in my own practice, retirement can be a period of frustration, sadness, emptiness and loneliness. And the level of dissatisfaction amongst retirees is not always directly related to their level of retirement income.”

Ms Hornery says she is concerned that many Australians may never get to do what they want to do in retirement because they don’t address what they want from it, as individuals and as couples, both personally and financially.

“There seems to be an unrealistic expectation amongst some couples that when they retire they will want to do everything together and will willingly surrender everything they currently do as individuals,” she says. “I therefore believe that long before they retire, pre-retiree couples need to sit down together and really discuss in depth what they want to do in retirement.”

They then need to take responsibility of their superannuation and retirement plans, taking into account their joint and individual needs.

“Generally speaking, men spend longer in the work force and have contributed more in superannuation than their wives and therefore have usually thought about what retirement means for them financially,” Ms Hornery says. “But they typically focus on reaching a lump sum. They don’t think about the impact of retirement, about what explicitly they are going to do,” she says.

The reverse is generally true for women. “They have usually thought through what they want to do in retirement but have less in retirement savings.”

The other problem facing couples is that there is also often a misalignment between partners about what retirement really means to them both.

“Couples need to set realistic individual and joint goals and objectives, then they need to have a way in which to reach them,” she says.  “I call this their great challenge.  It is a challenge which can take many years and requires the help of experienced professionals.”

Ms Hornery argues that qualified financial advisers, who care about their clients are vital in helping couples create, manage, review and protect their retirement dreams, “Not only because they have the technical expertise and professional qualifications to help them realise their goals, but because they have a commitment to reviewing the advice and strategy,” she says. “Their ongoing relationships with clients mean they can manage expectations and be brutally honest when necessary. Ongoing relationships between financial advisers and their clients are what can make a positive tangible difference in the lives of everyday Australians.”

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Retirement back on the agenda for the over 55s: Crowe Horwath

Retirement is back on the agenda for many Australians over the age of 55 according to Australia’s leading SMSF adviser, Crowe Horwath.

Susie Salmon, Head of Superannuation & SMSF for Crowe Horwath said we are having more discussions with clients about retirement strategies than since the global financial crisis (GFC). Clients aged over 55 are again ready to engage with advisers, plan and seek advice on retirement strategies.

“This is markedly different to the last five years where most conversations had been focussed on capital preservation,” Ms Salmon said.

“The last few years have been difficult for SMSF trustees, concentrating on rebuilding the capital base of their funds. This focus on re-accumulating funds lost during the GFC has led to many trustees not having the time to properly plan their portfolios for retirement,” she said.

Crowe Horwath has just completed a series of events throughout Australia with further events scheduled for February 2014. Titled Savvy Super Strategies, over 8,000 clients were invited nationally to discuss the importance of planning for retirement.

“The events aimed to arm clients with the knowledge to ensure they have the most effective solutions in place for retirement including tax planning, balancing member funds and estate planning,” said Ms Salmon.

“The strategies discussed ranged from as simple as consolidating superannuation accounts to more complex strategies around reducing the taxable component of retirement income streams. It is encouraging to see the high levels of engagement of clients attending, especially those looking to retire in the next five years.”

Crowe Horwath said trustees need to constantly review their retirement positions, no matter how young or old to track against future goals, even after you have retired.

It has a series of events planned in 2014 looking at a range of topics including Gen X/Gen Y, Property Structures, Tax Planning, Federal Government Budget Review, Pension Planning & Estate Planning all aimed at educating clients on aspects of their superannuation they need to consider.

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