K62 Finance

Higher bank capital to bite investors, clients

roymorgansocial Leave a comment

Original article by James Eyers
The Australian Financial Review – Page: 1 & 10 : 21-Jul-15

The Australian Prudential Regulation Authority has ruled that the nation’s major banks – and Macquarie Group – will need to hold more capital against residential mortgages. The average risk weighting on mortgage loans will rise from around 16 per cent to at least 25 per cent from 1 July 2016. Jarrod Martin of Credit Suisse estimates that the increased capital requirements will result in a modest rise in mortgage interest rates, while Richard Wiles of Morgan Stanley forecasts that dividend payouts will be reduced as a result of the reforms.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CREDIT SUISSE (AUSTRALIA) LIMITED, MORGAN STANLEY AUSTRALIA LIMITED, MACQUARIE GROUP LIMITED – ASX MQG, WESTPAC BANKING CORPORATION – ASX WBC, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, MOODY’S INVESTORS SERVICE INCORPORATED, CUSTOMER OWNED BANKING ASSOCIATION, DELOITTE TOUCHE TOHMATSU LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Dipping Australian dollar tipped to drop below US60c

roymorgansocial Leave a comment

Original article by Vesna Poljak
The Australian Financial Review – Page: 28 : 21-Jul-15

Deltec International Group’s Atul Lele says further interest rate cuts and fiscal policy easing are needed in Australia due to the country’s uncertain economic outlook. He says the economic downturn in Canada is likely to be replicated in Australia, and forecasts that the Australian dollar will fall below the $US0.70 level by the end of 2015. He also warns of the potential for it to fall below $US0.60.

CORPORATES
DELTEC INTERNATIONAL GROUP, BANK OF CANADA

ANZ-Roy Morgan New Zealand Consumer Confidence – Cold Snap

roymorgansocial Leave a comment

Original article by Roy Morgan Research
Market Research Update – Page: Online : 16-Jul-15

The ANZ-Roy Morgan New Zealand Consumer Confidence Index has fallen from 119.9 in June 2015 to 113.9 in July, which is its lowest level in almost three years. Sentiment has fallen by 15 points so far in 2015 and is now below its historical average of 119.1. The Current Conditions Index has fallen from 122.6 to 119.0, while the Future Conditions Index has eased from 118.1 to 110.4. Meanwhile, a net four per cent of New Zealanders believe that they are financially better off compared with last year.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Aussie banks ready for Apple Pay

roymorgansocial Leave a comment

Original article by Shaun Drummond
The Australian Financial Review – Page: 17 : 17-Jul-15

Apple is believed to be seeking a 0.15 per cent share of banks’ credit card interchange fees when it launches the Apple Pay service in Australia. The mobile payments service was officially launched in the UK on 14 July 2015, and is being supported by most of that nation’s lenders. David Gunn of Bain & Company notes that Australian banks have considerable bargaining power as they have already made a major investment in contactless payment technology.

CORPORATES
APPLE INCORPORATED, BAIN AND COMPANY, RESERVE BANK OF AUSTRALIA, VISA INTERNATIONAL, MASTERCARD AUSTRALIA LIMITED, PAYPAL INCORPORATED, WAL-MART STORES INCORPORATED, SAMSUNG CORNING COMPANY LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Canada, NZ moves point to more RBA rate cuts

roymorgansocial Leave a comment

Original article by Jacob Greber, Vesna Poljak
The Australian Financial Review – Page: 1 & 8 : 17-Jul-15

The Australian dollar reached a low of $US0.7354 on 16 July 2015, after the Bank of Canada reduced its cash rate to 0.5 per cent. The Reserve Bank of New Zealand is widely tipped to ease monetary policy in July, and economists suggest that this may prompt further rate cuts in Australia before the end of the year. Citigroup anticipates a rate cut of 25 basis points in November, while Deutsche Bank forecasts that the Australian dollar will test the $US0.65 level by the end of 2016.

CORPORATES
RESERVE BANK OF AUSTRALIA, BANK OF CANADA, RESERVE BANK OF NEW ZEALAND, CITIGROUP PTY LTD, DEUTSCHE BANK AG, ROYAL BANK OF CANADA, UNITED STATES. FEDERAL RESERVE BOARD, UBS HOLDINGS PTY LTD

David Murray endorses APRA on banks’ capital

roymorgansocial Leave a comment

Original article by Clancy Yeates
The Australian Financial Review – Page: 19 : 15-Jul-15

Proposed new capital requirements for banks have been described as "sensible" by financial system inquiry chairman David Murray. The Australian Prudential Regulation Authority has adopted some key recommendations of the inquiry, and Murray says he is not concerned about the fact that it rejected a recommendation for the nation’s banks to be among the top 25 in the world in terms of capital ratios.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD

ANZ-Roy Morgan Australian Consumer Confidence Plunges Further

roymorgansocial Leave a comment

Original article by Roy Morgan Research
Market Research Update – Page: Online : 14-Jul-15

The ANZ-Roy Morgan Consumer Confidence rating for Australia fell by 3.6 per cent to 107.0 in the week ended 12 July 2015, following a 4.6 per cent fall in the previous week. This more than reverses the positive reaction to the May rate cut and the Commonwealth Budget in just two weeks. Confidence is now at its lowest level in 12 months. The volatility in the Chinese stock market and continuing Greek debt negotiations have driven confidence lower. This was reflected in the sub-indices on the economic outlook, which both fell by around eight per cent. The sub-index on "economic conditions in next five years" reached its lowest level since the weekly series began in October 2008.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Business confidence steadies in June – but for how long?

roymorgansocial Leave a comment

Original article by Roy Morgan Research
Market Research Update – Page: Online : 13-Jul-15

A Roy Morgan Business Single Source survey has found that Australian business confidence rose slightly to 114.8 in June 2015, compared with 114.7 in May. While business confidence is now at its highest level since January (114.9), it remains below the five-year average of 117.2 and well below the peak of 136.3 in October 2013. Although business confidence remained steady in June, there was some deterioration in the outlook for how businesses feel regarding their own financial position over the next 12 months, as well as increasing concern that Australia will be facing economic difficulties over the next five years.

CORPORATES
ROY MORGAN RESEARCH LIMITED

CBA, ANZ tipped to lead $28b in capital raisings

roymorgansocial Leave a comment

Original article by Clancy Yeates, James Eyers
The Australian Financial Review – Page: 1 & 10 : 14-Jul-15

Shares in Australia’s four major banks fell on 13 July 2015, after the Australian Prudential Regulation Authority (APRA) indicated that they will need to lift their capital by 200 basis points. However, APRA does not think it necessary for the banks to have sufficient capital to rank them in the top quartile globally. Jarrod Martin of Credit Suisse estimates that the banks will need to raise about $A28bn of additional capital to comply with APRA’s recommendation.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CREDIT SUISSE (AUSTRALIA) LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, CLSA AUSTRALIA PTY LTD, AUSTRALIAN BANKERS’ ASSOCIATION

With US rates rising, UBS bets on a 70c dollar

roymorgansocial Leave a comment

Original article by John Kehoe
The Australian Financial Review – Page: 1 & 8 : 13-Jul-15

The Australian dollar reached a low of $US0.7372 in the week ended 10 July 2015. UBS Wealth Management expects it to test the $US0.70 level by the end of 2015, with global currency strategist Katherine Klingensmith citing factors such as the slowing Australian economy, the prospect of rate rises in the US and the downturn in commodity prices. BK Asset Management’s Kathy Lien adds that further interest rate cuts are likely in Australia, which would add to bearish sentiment toward the currency.

CORPORATES
UBS WEALTH MANAGEMENT, BK ASSET MANAGEMENT, RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF ENGLAND, DELTEC INTERNATIONAL GROUP