Investment review is on

The securities regulator (ASIC) is pressing ahead with a review of investment platforms that collectively hold more than $100 billion in superannuation savings to examine how platforms operate and whether stronger rules are needed for investors.

The review is likely to boost rules protecting investors with platform-held savings, potentially giving them the same rights as if they directly owned the underlying investment products.

Yes — the review could pave the way for fund managers to more easily have investment products listed on platforms, a change that might increase competition but could also put pressure on platform providers' returns.

Financial planners commonly use investment platforms as the 'hub' between consumers and the underlying fund products because platforms make it easy for advisers to manage clients’ investment portfolios.

The market is dominated by the big banks. At least 50% of advisers use Commonwealth Bank–owned FirstChoice and about 30% use Westpac’s BT Wrap, according to the article.

Control of the platform market became a sticking point with the competition regulator when NAB tried a $14 billion bid for AXA Asia Pacific, and those concerns ultimately forced NAB to shelve the takeover attempt.

Financial advisers usually use two platforms to manage client funds and sometimes use three.

ASIC’s proposals would require platform operators to meet standards relating to corporate structures and compliance issues to improve governance and investor protection.