First State Super and VicSuper have completed their merger, revealing fee reductions and board changes.
The merged fund now manages over $120 billion on behalf of 1.1 million members, including healthcare and aged care workers, teachers, police and emergency service workers, government and community workers.
In announcing the completion of the merger, VicSuper's former chief executive Michael Dundon revealed fees have seen a significant reduction.
"Our merger with First State Super is already delivering great outcomes for VicSuper members with a 20% reduction in fees for accumulation members within the first year," Dundon said.
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"While VicSuper has been a high-performing fund, our board knew that accessing scale through a merger would be key to driving value for our members into the future."
Dundon said the merger marks the achievement of VicSuper's strategy to align with a fund that had shared values and culture.
"Last year our boards set the goal to finalise the merger by 1 July 2020; and despite the challenges posed by COVID-19 over the past six months we are pleased to say that we have brought our two funds together as planned," he said.
"This would not have been possible without the dedication and commitment of our respective teams who despite the difficult external environment, were determined to finalise this merger to benefit our members."
Dundon will now join First State Super as a member of the fund's executive team where he will be responsible for overseeing the integration of VicSuper and supporting other future merger opportunities.
First State Super chief executive Deanne Stewart said the merger will deliver significant benefit to members of both funds.
"Both funds are top performing funds and believe deeply in the importance of investing in a responsible and sustainable way," Stewart said.
"Together we will leverage our combined scale to invest in ways that strengthen our community and the economy while continuing to deliver strong, sustainable long-term returns for members."
Stewart said the merger has created Australia's largest member owned national financial advice network, which will make it easier for members to access help and support.
"Our scale will enable us to drive down our administration and investments costs; savings that we will pass on to our members," she said.
The funds also revealed the new board members with Neil Cochrane working as the independent chair overseeing the fund's governing trustee board.
"Prior to the merger, it was agreed that the composition of our board would reflect the membership of the merged fund," Cochrane said.
"We are pleased to welcome four VicSuper directors to the board and acknowledge with gratitude the contribution of those VicSuper directors and First State Super directors who now step down following the successful merger."
The VicSuper representatives to join the new board are; Gabrielle Bell - nominated by the Victorian Public Sector Commission, Patricia Faulkner - nominated by the Victorian Department of Education and Training, Antoinette Masiero - nominated by the Australian Education Union and Travis Bates - nominated by the Community and Public Sector Union.
As part of the board transition Sue Carter and Rod Harty stepped down from the First State Super board. Rod Harty will remain a member of the Member Services Committee.
While fund operations, investments and employees are now part of one merged entity, the VicSuper brand will remain in market.