New Zealand Superannuation Fund grows on back of sharemarket rally

By Peter Kerr

Dec. 15 (BusinessWire) – The New Zealand Superannuation Fund has grown to just over $15.6 billion at the end of November, making a return of almost 14.7% in the five months since the end of June.

In a performance and portfolio update the fund has reported a net paper-based gain in the past five months of just over $2 billion, reflecting an increase in global share prices domestically and around the world. In November alone, it made a net gain after fees and before tax of $404 million.

Gains in the so-called Cullen Fund, set up by previous Finance Minister Michael Cullen as a means to reduce the taxpayer burden of an aging population nearing retirement, exceeded Treasury expectations in the four months ended Oct. 31, helping prop up sagging tax revenue as the economy comes out of its deepest recession in 28 years.

The fund reported a 22% decrease to $13.3 billion for the year ended June 30, again mostly a reflection of drop in world and New Zealand share prices.

As a passive investor in stocks based on index values the fund reports on its holdings in particular New Zealand and overseas companies when it is a Substantial Security Holder.

At Nov. 30 the Super fund held 9.75% of Auckland International Airport, 6.02% of Mainfreight Ltd and 5.02% of Skellerup Holdings.

In May, Finance Minister Bill English put new payments into the fund on hold until the government books return to surplus, something which wasn’t expected until 2020, though today’s Half-Year Economic and Fiscal Update has brought that forward to 2016. No withdrawals can be made from the fund until 2041.

(BusinessWire)