In an era when everyone hates banks more than ever, ME Bank is looking to capitalise on its heritage and ownership to build its position over the next couple of years. It may even be “keeping the bastards honest”, as the inimitable Don Chipp said in the lead-up to the 1980 Federal election.

Let’s face it: ME [Members Equity] is still a bank. But one of the good things about this bank is that it has a new chief executive who is committed to delivering the sort of services wanted by the members of the 35 industry funds which own it. ME Bank began, in 1994, as Super Members Home Loans, then half-owned by the then National Mutual (now AXA). It’s now being run, since last month, by a 21-yearveteran of another successful boutique bank, Bendigo and Adelaide Bank – Jamie McPhee.

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As the peak representative body for the $450 billion not-for-profit sector, AIST has played a major role in driving policy outcomes in the superannuation space to the benefit of the millions of working Australians who belong to industry, corporate and public sector funds, writes PHILIPPA YELLAND.

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The one certainty about  superannuation over the next 20  years is that it will grow. It’s the  miracle of compound interest plus  a legislated minimum of the flow of  foregone wages every week.  The structure of the industry,  either through evolution or new  regulation, is a little more difficult  to predict. There will be fewer  but larger funds, perhaps even  more SMSFs [when will they stop  growing in number?] and perhaps  fewer managers.  The influence of sponsoring  organisations, such as unions and  employer bodies, may wane – with  or without possible legislative  change to the make-up of trustee  boards – with the sheer size of  funds and continued push for  professionalism and best practice.

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For most super funds and other Australian institutional investors their experience with the ownership of infrastructure assets has, by and large, been a happy one. Not the same can be said for all such investors. Each of the eastern States has at least one disastrous toll road experience for investors and many retail investors in listed infrastructure funds were taught a painful lesson by the GFC.

According to Mike Fitzpatrick, a veteran of the asset class, much of the recent criticism of infrastructure – and certainly that part assigned to the investment banks which packaged and promoted many funds – is justifiable. He predicts that the days when investment banks fed transactions by outbidding each other to win tenders and then structuring the investments into funds, often with long-term management contracts in place, are hopefully over.

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