19.34%: Cbus Super delivers biggest return in fund’s history
Cbus Super has announced a 19.34% return for its Growth (Cbus MySuper) option, the largest ever annual return in the fund’s 37-year history.
Cbus Super Chief Investment Officer Kristian Fok said the outstanding result was a demonstration of the fund’s strategic approach to markets during Covid-19 volatility.
“I’m proud of the way that our investment teams have negotiated market volatility over the last 18 months,” Mr Fok said.
“Cbus was one of a small group of funds to achieve a positive result (0.75%) during the previous 2019/20 financial year. To then have the confidence to get back in the market is testament to the people and structures that we have put in place over the last five years.
“We managed our cashflow exceedingly well during the initial Covid-19 volatility which meant that we could invest for our members on the upswing.”
Cbus Super now manages 35% of assets in-house. Mr Fok said building up this internal capacity has provided the fund greater insights into markets and allowed for a significant reduction in investment fees.
“We have reduced investment fees by $400M since 2017 which has helped add to our returns,” he said.
“We have seen the cost of managing a dollar of savings fall by 8% compared to last year which is a really strong outcome.
“Results like this are strong indicator of the significant benefits of being involved in a fund of this scale.”
Mr Fok said the fund’s focus on increasing scale and reducing fees should serve members well as market conditions become more difficult.
“Obviously we would love to see strong double-digit returns like this every year but indications are that conditions will become tougher,” Mr Fok said.
“That’s why increasing scale and reducing investment costs is so important. Superannuation is a long-term game and the gains members see from fee savings will compound over time.”
Cbus Super CEO Justin Arter said the fund’s expertise in property and the built environment benefitted both members and the wider economy as the country struggled with Covid-19 lockdowns.
“There were stages last year where quality developments were struggling to get the finance they needed,” Mr Arter said.
“As banks were tightening lending, Kristian and his team were able to support successful developments to keep going at a pivotal time for the construction industry. Cbus Property has also been able to commit to new projects during the height of the pandemic.
“Our lending enabled the delivery of 862 new residential units, which is a really important contribution given some of the supply constraints we are now seeing.
“On top of that, Cbus Property released 471 apartments to market during the last financial year, continuing their significant pipeline of work.
“We are proud of the record result we have achieved for members and of the way we have supported construction jobs and property supply at such an important time for the country.”
The Growth (Cbus MySuper) investment option return is based on the crediting rate, which is the return minus investment fees, taxes, and until 31 January 2020, the percentage-based administration fee. Excludes fees and costs that are deducted directly from members’ accounts. Past performance is not a reliable indicator of future performance
Cbus Property Pty Ltd is a wholly-owned subsidiary of United Super Pty Ltd and has responsibility for the development and management of Cbus’ direct property investments.
Tristan Douglas, 0417 736 434 or firstname.lastname@example.org