Two of Australia’s largest profit-for-member super funds – QSuper and Sunsuper – have begun discussions on a possible merger to create what would be Australia’s largest superannuation fund of around A$182bn (€113bn).

Currently, that crown belongs to AustralianSuper, which manages A$172bn.

The two Brisbane-based superannuation funds both cater primarily to Queensland employees. At July 31, QSuper had A$113bn and Sunsuper A$69bn in funds under management.

In a joint statement, the chairmen of the two funds, QSuper’s Karl Morris and Sunsuper’s Andrew Fraser, said both funds were in talks on a non-binding basis about a possible partnership.

“There is an absolute responsibility upon trustees to consider how to best serve members’ interests. Whether a partnership between our two funds could be better for both QSuper and Sunsuper members is an appropriate enquiry,” they said.

“Whether or not that consideration proceeds beyond preliminary discussions is dependent on many factors. In the meantime, both Sunsuper and QSuper members may be assured they will be kept informed of any material decisions.”

Sunsuper itself has grown rapidly in recent years, taking over a number of smaller super funds. Its most recent mergers, with Kenetic Super and AustSafe Super, have occurred in the past 12 months.

Australia’s A$2.8trn superannuation industry is undergoing a wave of mergers and acquisitions as consolidation continues.

Australia’s smaller super funds are under pressure to find a merger partner to achieve economies of scale and deliver better and more efficient services to thousands of Australian retirement savers.

The pressure on directors of super fund trustees has stepped up following a report from the Productivity Commission, a federal government agency, into the industry.

First State Super, the largest NSW-based profit-for-member fund, is currently in talks with VicSuper, from Victoria, to merge the savings of more than 1 million contributors into a A$120bn fund.

First State and VicSuper have agreed on the composition of the board of the enlarged scheme, with First State Super’s current independent chair, Neil Cochrane, to be appointed chair.

Details of integrating the two funds continue to be worked out, but it is expected that a merger could be formalised by the end of this year.

Australia’s hospitality and sports industry fund, the A$43bn Hostplus, and the smaller Club Super this month officially consummated their merger.

Other recent mergers include Equip Super and Catholic Super, which combined their operations in May, making it Australia’s thenth largest profit-for-member fund with A$26bn in assets.

Tasplan, which covers workers in Tasmania, and MTAA (Motor Trades Association of Australia) Super have entered into a binding memorandum of understanding to merge. If successfully completed, the national fund will manage more than A$22bn in investment savings for more than 320,000 members.