Frontier Advisors awarded investment advice mandate

Frontier Advisors has been appointed as an external investment consultant by an ASX-listed group after it suffered a reduction of nearly $30 million in net investment income in FY26.

Medibank Group has awarded Frontier Advisors a mandate to provide investment advice in relation to its investment portfolio, including asset allocation and external manager selection and monitoring.

The relationship will draw on the investment consultant's experience and reflects its Liability Driven Investing (LDI) team that also provides similar services to other APRA regulated entities.

Frontier Advisors director of client development and co-head of LDI and government Elie Saikaly said he was delighted with the appointment.

"We look forward to working closely with Medibank Group's team and using our deep LDI sector expertise and investment capabilities to support Medibank's purpose of 'Better Health for Better Lives'," Saikaly said.

The appointment further strengthens Frontier Advisors' growing presence in the insurance sector and reflects heightened demand from APRA regulated entities for specialist, governance-focused investment advice, it said.

According to its FY26 financial report, Medibank's investment portfolio was $3.4 billion as at 30 June 2026, including $3.1 billion relating to the health fund and short-term operational cash of $200 million.

Throughout the period, net investment income dipped $28.9 million, or 13.9%, to $178.9 million, with a $7 million reduction in both its growth and defensive portfolio income, respectively.

"The decrease in our growth portfolio income reflects lower income from both Australian and international equities, which was partially offset by improved performance in both property and infrastructure," Medibank said.

"Our defensive portfolio income was impacted by a $7.5 million decrease in interest income from the lower average RBA cash rate, a $2.6 million increase in interest income from a higher average defensive portfolio balance, and a $2.7million cost from widening credit spreads this period ($900,000 cost in 2025).

"In 2027, we expect underlying net investment income to benefit from growth in asset balances, a higher average RBA cash rate ($6.4 million higher annual interest income for every 25-basis point change in RBA cash rate) and opportunities to increase liquidity and credit margins."