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[Updated] Fund managers on home straight of licencing race

Monday 28th of November 2016

Good Returns is aware of two fund managers which aren’t going to be licensed retail funds.

One is Socrates Funds Management which is run by financial adviser Charles Drace. The company says on its website “Socrates' 21st Century Unit Trusts are closing on 26 November, 2016”
Good Returns has been unable to contact Drace.

Also King Tide Asset Management is currently closed. Its website says: “King Tide Fund is temporarily closed to any new investment, including from any existing investors.”

It is understood King Tide, which runs a long short , Australasian equities fund will transition to being a wholesale fund, rather than a retail fund. The main reason for this move is around the the costs of compliance relative to the size of the fund.

The deadline for licensing of providers under the Financial Markets Conduct Act (FMCA), including managed investments schemes, DIMS providers and derivatives issuers, is this Thursday.

At the end of last week, there had been 66 managed investment schemes, 53 DIMS providers, 22 derivatives issuers and 31 independent trustees licensed.

FMA director of regulation Liam Mason said the FMA was happy with how the FMCA process had gone.

He was confident that everyone who was operating in the market and wanted a license to continue to do so after December 1 would have one issued in time.

Earlier in the year, the FMA had warned that applications needed to be in by the end of August if applicants were to be sure of meeting the December 1 deadline.

“There was a really good reaction to that from firms, the vast majority were in in time.”

Mason said it was possible there were still some operators who did not realise their obligations under the FMCA. After December 1, the FMA would do surveillance of the market to identify them.

But he said providers such as managed investment schemes were operating under the Securities Act and already needed a supervisor so the FMA was able to identify who they were and help them through their obligations.

As a result of the licensing, consumers could have more confidence that their providers were having to meet minimum standards they had not been expected to in the past.

Managed Investment Schemes registered as at Nov 26

  • Accordia Asset Management Limited
  • Amanah Trust Management (NZ) Limited
  • AMP Investment Management (NZ) Limited
  • AMP Wealth Management New Zealand Limited
  • ANZ New Zealand Investments
  • AON Saver Limited
  • ASB Group Investments Limited
  • Aspiring Asset Management Limited
  • Augusta Funds Management Limited
  • Australian Scholarships Group Friendly Society Limited
  • BNZ Investment Services Limited
  • Booster Investment Management Limited (Previously Grosvenor Investment  Management Limited)
  • BT Funds Management (NZ) Limited
  • Castle Point Funds Management Limited
  • Conrad Funds Management Limited
  • Craigs Investment Partners Superannuation Management Limited
  • Devon Funds Management Limited
  • Elevation Capital Management Limited
  • First Mortgage Managers Limited
  • Fisher Funds Management Limited
  • Forest Enterprises Limited
  • Forsyth Barr Investment Management Limited
  • FSF Management Company Limited
  • Fund Managers Central Limited
  • Fund Managers Otago Limited
  • Funds Administration New Zealand Limited
  • Kiwi Wealth Limited
  • GMI Wealth Limited
  • Gareth Morgan Investments Limited Partnership
  • Generate Investment Management Limited
  • Goodman (NZ) Limited
  • Harbour Asset Management Limited
  • i-Select Limited
  • Implemented Investment Solutions Limited
  • IOOF New Zealand Limited
  • JMIS Investment Management Limited
  • Lifetime Asset Management Limited
  • Mainland Capital Investment Management Limited
  • Medical Assurance Society New Zealand Limited
  • Mercer (N.Z.) Limited
  • Milford Funds Limited
  • Mint Asset Management Limited
  • New Ground Capital Limited
  • New Zealand Assets Management Limited
  • New Zealand Funds Management Limited
  • New Zealand Investment Portfolio Management Limited
  • Nikko Asset Management New Zealand Limited
  • Norfolk Mortgage Management Limited
  • Oyster Management Limited
  • Pathfinder Asset Management Limited
  • Pie Funds Management Limited
  • Plaza Funds Management Limited
  • Property Managers Limited
  • QuayStreet Asset Management Limited
  • Ranfurly Strategic Limited
  • Roger Dickie (N.Z.) Limited
  • Senior Trust Management Limited
  • Silverfin Capital Limited
  • Simplicity NZ Limited
  • Smartshares Limited
  • Salt Investment Funds Limited
  • Trust Investments Management Limited
  • Vital Healthcare Management Limited
  • Whai Rawa Fund Limited
Financial Markets Conduct Act
Comments (3)
gavin austin
I have seen some of the PDS documents for some of those on the list and was quite surprised some of them got through at all. But then with licencing there can be an approach along the lines of "They will get a License it's just a matter of how we can find a way to get it through". This was one of the "themes" expounded during QFE licensing leading up to the then deadline 31 March 2011 and we all know now what repercussions came from QFEs in relation to sales practices. Lets hope the FMA regulatory oversight and monitoring of these licenses is more robust. There might be disclosure but will Joe public be better informed or more confused. Some of what I have seen will result in the latter. FMA may make an example of some small market participant meanwhile the big end of town carries on very nicely thanks. If poor ole Joe public have to x reference the PDS with 2 or in some case 3 other documents what chance have they of being better informed, less confused or more confident so called aims of the FMC Act.
0 0
8 years ago
John Milner
Gavin, I too have looked at a new PDS and what is apparently the new "approved format". Where in the past fees were broken down i.e. Trustee, Registry, etc. This has now been replaced with one fee covering all parties involved. How does that provide transparency for clients?
0 0
8 years ago
Brent Sheather
The FMA have said before that, when assessing financial advisors performance, it will look at outcomes rather than whether people have just ticked the boxes. My view of the FMCA is that the regulators hands have been tied by the investment bankers at the MBIE, in Government and on the FMA board. As a result the new rules just tick the boxes and the outcomes for retail investors are largely unchanged. To name a few areas which are yet to be addressed: proper disclosure, high fees, unfair performance fees etc etc etc. My view is that the industry will be well pleased with the Financial Markets Conduct Act. For some comparison on the performance of the FMA look at what the FCA is doing, post Brexit. At last a regulator that is putting clients’ interests first. Regards Brent
0 0
8 years ago
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