Commenting on the results, Challenger chief executive Brian Benari said 2014 has been a “very successful year” with opportunities around retirement income “continuing to accelerate”.
“Challenger has recorded five straight years of retail annuity sales growth, and has unambiguous expansion prospects,” said Mr Benari.
“Lifetime annuity sales growth has been phenomenal, hitting $613 million from only $46 million two years ago.
“But the post-retirement market remains largely untapped because this year saw more than $66 billion a year flow from the savings phase to the pension phase of super,” said Mr Benari.
Mr Benari said similar opportunities for growth await its boutique funds management business.
“We have close to $50 billion in FUM and the same again in available capacity, with diversification by asset class and product and strong investment track records,” said Mr Benari.
Challenger outlined that of the $2.8 billion in retail sales, $2.186 billion were fixed term annuities, with lifetime annuities comprising the balance of $613 million up from $257 million in the previous financial year.
Challenger also said its retail annuity book grew by 12.5 per cent to $887 million, which slightly exceeded its revised guidance range of 10 to 12 per cent.
“Retirees have voted with their wallets because they saw that annuities didn’t miss a beat during the GFC,” said Mr Benari.
“They want to complement the market exposure of account-based pensions with the security and reliability of guaranteed lifetime income.”
