ING Direct goes for bite of lucrative retail super market
THE online bank ING Direct plans to launch its first retirement savings product within months in an attempt to gain a slice of the nation's $360 billion retail superannuation market.
THE online bank ING Direct plans to launch its first retirement savings product within months in an attempt to gain a slice of the nation's $360 billion retail superannuation market.It will be a re-entry into superannuation for the Dutch-backed ING Group. For years the European financial giant operated a wealth management joint venture with ANZ. This was dissolved three years ago when ANZ paid $1.8 billion to move to full ownership and renamed the wealth business OnePath.It is understood that a non-compete clause between ING and ANZ that was part of the transaction expired earlier this year. This means ING will again be able to use its own branding to sell wealth management products.Much of the motivation for ING returning to the superannuation market was the development of a MySuper style product. This low-cost default account is aimed at delivering basic retirement savings needs and was the centrepiece of the Cooper review into the nation's super system.A spokesman for ING Direct declined to comment on the bank's plans for superannuation but said the online specialist was planning to take a major step into becoming a full-service retail bank.Since launching in Australia early last decade, ING Direct has emerged as the nation's sixth biggest bank in terms of retail deposits. It has more than $18.7 billion in household deposits, slightly behind Bendigo and Adelaide Bank on $18.8 billion.Even without a branch network ING Direct has built up a $38 billion mortgage book.Banks have placed renewed hope on wealth management as profit growth in other areas of banking, such as lending, slows.Superannuation savings are expected to increase from about $1.2 trillion today to more than of $6 trillion by 2030.About a third of the savings are held in the hotly contested retail superannuation market.For banks, wealth management has long been the holy grail for a source of potential earnings power, but the businesses have often delivered disappointing returns for shareholders.