Retail corporate bonds could be packaged up with the huge and growing SMSF sector as a way to develop another asset class, the Assistant Treasurer said in a keynote speech.
Arthur Sinodinos made these comments in a keynote address to the ANZ global capital markets corporate debt conference on Friday.
Among other topics, his speech touched on capital allocation issues and the development of superannuation in Australia.
The theme was important to address with the looming Murray inquiry, he said, that will look at the life of the development of superannuation in Australia, which with $1.6 trillion is one of the biggest pools in the world.
Sinodinos said that in light of debate on how, and the extent to which, capital in super funds is allocated – especially considering criticism that too much is being put into equities – we should look at how to develop other asset classes.
“We talked before about retail corporate bonds. I’d look at the self-managed super fund sector which has now got a third of Australian’s super savings. They’re looking for infrastructure projects – retail infrastructure projects – so I’m keen to get ideas on how do we package that up,” he said.
If we solve the broader issue of how super funds can invest more in infrastructure assets, something more could be developed, Sinodinos added.
“It’s all about how you create all sorts of different products to create a greater choice of asset test, if you like. For us that’s a very important process that still is ongoing.”
His speech also covered the need to continue the work of promoting Australia as the hub for financial services. Sinodinos said Australia’s presence at the G20 is a great platform to do this.
“In that context, we’re promoting as I said, infrastructure,” he said. “We are promoting capital market liberalisation; we are completing the financial regulation agenda that came out of the global financial crisis.”