ANZ rids its KiwiSaver scheme of Russian investments, BNZ to follow

Tuesday, 1 March 2022

Large bank KiwiSaver schemes own investments in Russian government bonds, and in the Putin-controlled Sberbank.

ANZ has dumped all investments in Russia from its KiwiSaver scheme.

The announcement follows a move by Westpac to sell out of its Russian investments following Russia’s invasion of Ukraine.

Bank of New Zealand (BNZ) says it has also instructed the fund manager of its KiwiSaver scheme to dispose of its Russian investments.

On Monday, KiwiSaver research company Mindful Money published a list of KiwiSaver and other investment funds with investments in Russian companies and government bonds.

* Why NZ Super Fund must dump Sberbank of Russia over Ukraine invasion

* Westpac KiwiSaver to dump Russian Government bonds

ANZ’s KiwiSaver scheme has now exited all its investments in Russian companies and Russian government bonds.

ANZ said it sold out of about $12 million of Russian investments last week as Russia’s aggression began to become clear.

An ANZ spokeswoman said: “ANZ Investments can confirm our funds, which include KiwiSaver, now have no investments in Russia.

BNZ is ridding its KiwiSaver funds of Russian investments.

“When we saw the situation was rapidly deteriorating last week we acted quickly and commenced divesting around $12m of Russian holdings we owned.”

That was only a fraction of the fund manager's investments, she said.

It represented less than 0.04 per cent of ANZ Investments total investments.

The move was prompted by ANZ Investment’s responsible investing philosophy, she said.

Sberbank of Russia is 50 per cent owned by the Russian government, which also has majority voting rights over it, giving it control. Slide from Sberbank's annual report.

A BNZ spokesman said: “Given the situation in the Ukraine, we have instructed our International Equity and International Government Bond manager to divest all Russian securities from our BNZ KiwiSaver Scheme and YouWealth.”

Russia has become an international investment pariah, and the value of Russian company shares has crashed as pension funds and sovereign wealth funds around the world try to sell their holdings.

BP announced it would sell its stake in Russian oil company Rosneft, and in Australia the New South Wales Government said it would drop A$75 million (NZ$80m) of Russian assets in one of its state investment funds.

Norway's giant sovereign wealth fund announced it would sell all its US$2.8 billion (NZ$4.2b) investments in Russia.

The New Zealand Superannuation Fund has seen the value of its Russian investments plummet from just under $25m to $9m.

Its largest investment in Russia is in Sberbank, Russia’s largest bank, which is 50 per cent owned by the Russian state.

It has not said whether it will sell its Russian investments.

A spokesman for the NZ Super fund said: “We are currently assessing the implications of Russia’s actions under our responsible investment policy regarding the fund’s equity holdings and sovereign bonds. Any decisions will be implemented and then announced.”

International news service Reuters has reported that the Kremlin-controlled Central Bank of the Russian Federation has ordered “professional stock market participants to suspend the execution of all orders by foreign legal entities and individuals to sell Russian securities”.

The Russian stock market is also temporarily closed.