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Official launch of Bendigo Wealth’s Income Fund


23/05/2013

People with a mortgage may be breathing a little easier as they see interest rates hit historic lows, but not everybody has a mortgage. Those relying on income from investments such as term deposits and savings accounts are faced with increasing bills for energy and fuel and may be in less of a position to afford a holiday or to assist with a grandchild’s education. Such a situation may see them casting around for a more acceptable return - and protection against inflation.

Bendigo Wealth was launched in April 2011 and brought several parts of the business together under the one umbrella - including Sandhurst Trustees which was founded 125 years ago this year.

To celebrate our second birthday, Bendigo Wealth is launching the Sandhurst Strategic Income Fund (Income Fund) to add to the growing range of products and services - particularly managed funds and superannuation - that have been winning recognition and critical acclaim. The Income Fund joins other product launches since Bendigo Wealth’s inauguration, namely, Bendigo SmartStart Super® and the Bendigo managed wholesale fund product suite (comprising 10 managed funds).

Alexandra Tullio, Head of Wealth Markets said: “Bendigo Wealth is increasingly recognised for our funds management capability, particularly by independent financial advisers. Over-the-counter enquiries in the short time since the official launch have also been on the rise.

“We recognise that there are many Bendigo customers especially those approaching or already in retirement with existing term deposits who are looking for regular income and good returns. They’re looking for that happy medium with an experienced funds manager.

“Understandably, these customers are risk averse. They’re not considering bonds, and term deposit returns are lower than they’d like - but they’re not yet ready to venture back into the equities market either.

“We’ve used our years of wealth management experience to build the Income Fund as a stepping stone between investment classes such as bonds, term deposits and equities. We’re saying that the Income Fund is well qualified to be in that sweet spot as a customer’s first and perhaps logical alternative to a term deposit”, Ms Tullio concluded

Paul Rohan, Head of Sandhurst Trustees added “Sandhurst’s income fund is a low risk investment with quarterly income distributions. But unlike a term deposit funds can be accessed weekly without penalty and there’s no need for rollovers. Best of all in the 12 months to April 2013, the Sandhurst Income Fund (Class A units) returned 6.49%* net of fees and costs - and that’s higher than most term deposits over the same period.

“To those investors who may not have considered Bendigo for our wealth management capability, we’re saying perhaps you should come and have a look at our product range. A particular feather in our cap is that we were one of just a handful of Australian fund managers who didn’t freeze redemptions in our mortgage funds during the GFC”, Mr Rohan concluded.

Income Fund Nuts and Bolts

  • A low risk investment option
  • Quarterly income distributions
  • Withdrawal requests processed weekly (tax consequences may apply)
  • No need for rollovers - saving time for customers (and their advisers)
  • Add to your investment at any time - you don’t need to wait for your existing term deposit to mature

The Income Fund invests in income generating fixed income products such as:

  • Term Deposits
  • Money Market securities
  • Fixed interest bonds
  • Floating Rate Notes
  • Asset backed securities
  • All Aussie (no foreign currency)
  • $5,000 minimum initial investment
  • Annual Fee 0.79%
  • Buy/Sell Spreads (10 basis points (BP) for a buy/20BP for a sell - subject to change)
  • On $50,000, that’s $50 in/$100 out
  • Year to 30 April 2013 returned - 6.49*% (net of fees and costs)
  • That’s over $3,000 return on $50,000
  • Can take money out weekly if you like

The Income Fund may be suitable for: Customers seeking a regular income or who have specific savings goals and is also a great solution for the defensive asset allocation of an investment portfolio.

About the Income Fund

Celebrating 125 Years

Australia Ratings

Sandhurst Trustees is pleased to announce that Australia Ratings has assigned its credit rating of ‘A’ to the units issued by the Sandhurst Strategic Income Fund (the Fund).

Australia Ratings is the only domestic rating agency that can issue credit ratings to financial products offered to retail investors in Australia. Through their independent assessment of financial products Australia Ratings assigns ratings to differentiate the degree of credit worthiness of organisations and fixed income products available to investors in the Australian financial market.

A rating of ‘A’ indicates the Fund has a strong degree of protection against loss from credit risk on the rating scale used by Australia Ratings and reflects the credit quality of the Fund’s investments as well as the experience and skill of Sandhurst Trustees as the Investment Manager. Additionally Australia Ratings has assigned a Product Complexity Indicator of ‘Blue’ indicating the Fund is a relatively simple financial product.

The units of the Fund are rated ‘A’ by Australia Ratings. This rating implies the Fund has a strong degree of protection against loss arising from credit risk. A rating is not a recommendation to invest, retain or redeem units in the Fund. The rating may be subject to change or withdrawal at any time. A copy of Australia Ratings Financial Services Guide can be found at http://www.australiaratings.com/fsg.

*Past performance is not necessarily an indication of future performance. Sandhurst Strategic Income Fund (Income Fund) and Bendigo SmartStart Super (ABN 16 004 030 737) is issued by Sandhurst Trustees Limited (Sandhurst) ABN16 004 030 737 AFSL 237906 a subsidiary of the Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL 237879 (the Bank). Investments in these product are not deposits with, guaranteed by or liabilities of the Bank or any of its subsidiaries. Income Fund Class A units have been described in this article. You should consider your circumstances and read the PDS available at www.bendigowealth.com.au before making an investment decision.