CBA also noted that "according to APRA....>

AUSTRALIA: CBA also noted that "according to APRA data on a sub-set of super

funds, about 10% (A$300bn) of super assets are invested in cash. Therefore, the

early release of an extra A$18bn is only somewhat important for super funds. Is

the early release material for financial markets? For AUD, the key question is

how much of super's foreign currency denominated assets will be sold to pay for

the redemptions. What we do know is foreign listed equities & international

fixed interest account for 25% & 9% of super respectively. Other assets such as

foreign property & infrastructure will increase that share. But we are confident

well < 50% of super is invested offshore. Let's assume super funds decide to

fund 40% of the extra A$18bn redemptions by selling foreign assets. Therefore,

~A$7bn of foreign assets will be sold to pay for the early redemptions. That

figure of ~A$7bn is very small compared to 'normal' daily turnover of all AUD

instruments of US$220bn or spot AUD of US$85bn. Even if the recent disruption to

financial markets has slashed currency turnover by half, the AUD market should

be able to digest A$7bn of buying over a number of weeks. Some of the AUD buying

would have already happened in preparation for the outflows in any case."