Colonial First State will launch a new wrap platform in late 2022 with New Zealand-based platform-as-a-service provider FNZ appointed to deliver the transformation.
The launch is part of CFS’s $430 million investment strategy to build out the company over the next four years, after private equity giants KKR completed its acquisition of the business in December after first aiming to buy the CFS platform, pensions and investments business in 2020.
FNZ offers investment platform software used by over 150 institutions globally, holding $2.1 trillion in assets under administration. CFS cited its establishment in the Australian market, where it currently holds $70 billion AUA, as reason for the partnership.
Kelly Power, CFS chief executive, said the deal has the backing of both KKR and CBA as shareholders.
“A key focus for us will be to work with advisers on the new design to seamlessly integrate the platform into other systems that advisers use every day in their practices,” Power said.
The investment in the platform business comes as smaller rivals Netwealth, HUB24 and Praemium have seen an increase of market share over the last two years.
According to research from Plan For Life, CFS’ platform market share decreased from 15.4% to 14.6%, but it is still the fourth largest platform.
“While we already have a strong position in the master trust platform segment, this will greatly strengthen our competitiveness in the wrap platform sector, deliver substantial benefits for our members and their advisers, and allow us to become one of the major players,” Power said.
