More than $250 billion was lost from the retail and wholesale superannuation market in the 12 months to December 2008, according to financial services research house Dexx&R.
The report revealed that total funds under management and administration (FUMA) in the retail and wholesale markets plummeted by 26.67 per cent to $708.2 billion, down from $965.7 billion as at December 2007.
The December 08 quarter FUMA also showed a steady decline decreasing by 12.6 per cent from $810 billion to $708 billion as at September 2008.
The retirement incomes market also showed signs of slowing as investors spooked by the financial climate started to seek redemptions.
The market dropped 11.3 per cent in the December 08 quarter.
According to Dexx&R, this fall can be viewed as an indicator of the decline in investor sentiment combined with the state of the economy.
"Retirement incomes are mirroring the decline in shares prices. There had been stronger inflows into retirement incomes because money kept flowing in from more recent retirees who were setting up allocated pensions. Whereas in the personal super space, the voluntary contributions dropped off a little earlier," Dexx&R managing director Mark Kachor said.
All the top ten companies in this market experienced falls.
The biggest drop was felt by Barclays which dropped 20.5 per cent in the December 08 quarter.
Frontrunner AMP was able to retain its first place position but still lost 11.1 per cent in the three months from September 2008.
"I would expect there to be further declines in the short term before market start to stabilise," Kachor said.
