‘Collaborative’ La Trobe reinforces safety of its funds
La Trobe Financial has sought to reassure financial advisers about how it navigated the Australian Securities and Investments Commission (ASIC) now removed interim stop order on its two funds with a script explaining the situation is temporary and the investments are safe.
La Trobe announced to advisers late yesterday that the interim stop orders had been lifted on its Australian Credit Fund but that discussions are continuing with the regulator in respect to its USPC Fund.
In an update to financial advisers issued on Monday, La Trobe stressed that it is “working collaboratively with ASIC” and that “it is important to understand that this is not a reflection on the products themselves, nor on their performance”.
“The current action relates specifically to ASIC’s concerns about the TMDs (target market determinations). ASIC has issued nearly 100 Interim Stop Orders across the industry since the DDO (Design and Distribution Obligations) regime came into effect,” the script says.
“In essence, there are three issues raised by ASIC relating to the TMDs. The issues are:
- ASIC did not agree with the proposed maximum suggested allocation to the 12 Month Term Account, 2 Year Account and US Private Credit Fund (Class B Units).
- That in relation to the 12 Month Term Account and the 2 Year Account, there could be stronger distribution conditions to ensure that investors fall within the target markets; and
- The investment timeframe for retail clients in the target market for the US Private Credit Fund should be more specific.
La Trobe’s script said “There are no changes to existing investments. The only impact is that investors are temporarily unable to make new investments into the affected products. Everything else remains unchanged:
- La Trobe Financial’s portfolios remain conservatively managed and highly diversified.
- Existing investments will continue to earn monthly interest, which will be paid on time and in full.
- The portfolios hold ample liquidity to meet investor withdrawals. Maturities and redeeming investments will be paid on time and in full.
- A reminder that no capital losses have ever occurred within La Trobe Financial’s
portfolio accounts, and La Trobe Financial has never gated and never frozen their Funds due to a liquidity issue.
The script goes on to say that La Trobe is well positioned to navigate the period and is working collaboratively with ASIC to address each of the issues.
“It is hoped the matters will be resolved, and the Interim Stop Orders lifted, as a matter of urgency. They are committed to transparency and keeping advisers and investors updated on the status of these matters.”
This is how it starts. The house of cards is teetering.
ASIC doing some pushing too.
Are you one of those financial advisers that tells the clients that as soon as the market drops, you and your clients panic and jump out of equities or any other investment that you perceive is now a risk and go straight to CASH!
Most times it’s the market and not necessarily the investment, but you all behave like you’re now participating in a Chinese fire drill.
Ridiculous post devoid of any apparent knowledge as to any of the matters at hand.