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Funds owned by big four busted paying customers up to 75 per cent LESS than the market rate

  • Internal superannuation data shows cash returns are being paid below market 
  • SuperRatings put together data which showed returns averaged just 0.05% 
  • Analysts say big four banks command large funds and should have larger returns

The big four banks have been busted paying customers up to 75 per cent less than the market rate with superannuation funds

Superannuation funds owned by the big four banks are reportedly boosting their own revenue by hundreds of millions of dollars by paying out cash returns to elderly customers at less than a quarter of the market rates.

Industry data obtained by The Australian shows that people with the Westpac-owned BT Business Super Fund who chose cash options were receiving a return of just 0.05 per cent a year.

The appalling returns come despite the average cash rate and bond yield in the last two years being  2.03% and 2.48% respectively. 

Industry experts told The Australian that a systemic culture of price gouging by the big four banks and their superannuation companies were to blame for the poor performance of the funds.

Figures released by the Prudential Regulation Authority has shown that 95% of retail super funds had not delivered returns above the median for the past 10 years.

The big four banks have been accused of price gouging in the past and denied the claims, saying that comparing their super funds with others was akin to comparing ‘apples and oranges’. 

Internal superannuation industry data has shown that superannuation funds owned by the big four banks are boosting their own revenue by hundreds of millions of dollars by paying out cash returns at less than a quarter of the market rates

Internal superannuation industry data has shown that superannuation funds owned by the big four banks are boosting their own revenue by hundreds of millions of dollars by paying out cash returns at less than a quarter of the market rates

Data from SuperRatings which has shown that people with the Westpac owned BT Business Super Fund who chose cash options were receiving a return of just 0.05% a year

Data from SuperRatings which has shown that people with the Westpac owned BT Business Super Fund who chose cash options were receiving a return of just 0.05% a year

However analysts have argued that it is a ‘like for like’ comparisons which takes out the variables. 

For contrast, ANZ’s One Path subscribers who invested in their cash scheme received only 0.59% a year on their cash investments while funds owned by NAB returned averages of just 0.05%.  

However analysts have spoken out and said that returns on cash should be much higher than what is being paid out by the big four’s superannuation funds, mainly because those banks had the capital to invest and get better rates. 

Figures from the Australian Association of Superannuation Funds of showed that superannuation funds owned by the big four banks managed a total of $309 billion worth of funds.   

Analysts have spoken out and said that returns on cash should be much higher than what is being paid out by the big four's superannuation funds, mainly because those banks had the capital to invest and get better rates

Analysts have spoken out and said that returns on cash should be much higher than what is being paid out by the big four’s superannuation funds, mainly because those banks had the capital to invest and get better rates

 

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