K62 Finance

Big four rank high for profitability: BIS

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Original article by Clancy Yeates
The Australian Financial Review – Page: 16 : 29-Jun-15

The Bank for International Settlements’ annual report shows that Australia’s four major banks outperformed their peers in developed countries in terms of profitability in 2014. The banks’ pre-tax profits were 1.28 per cent of their assets during the calendar year, ahead of the US and Canada. TS Lim of Bell Potter notes that Australia’s comparatively high interest rates contributed to the profitability of local banks.

CORPORATES
BANK FOR INTERNATIONAL SETTLEMENTS, BELL POTTER SECURITIES LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Credit card rates up despite cash rate drop

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Original article by Clancy Yeates
The Australian Financial Review – Page: 16 : 24-Jun-15

Data from the Reserve Bank of Australia shows that the average credit card interest rate has risen to 19.75 per cent since the currency monetary policy easing cycle began in 2011. The cash rate has fallen to just two per cent over the same period. MWE Consulting’s Mike Ebstein attributes this to the fact that the proportion of credit card debt that is accruing interest has fallen from 73.7 per cent to just 65.6 per cent, with more consumers opting to pay their entire credit card debt each month.

CORPORATES
RESERVE BANK OF AUSTRALIA, MWE CONSULTING PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY, CONSUMER ACTION LAW CENTRE

ANZ-Roy Morgan Australian Consumer Confidence Edges Down

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 23-Jun-15

The ANZ-Roy Morgan Consumer Confidence rating for Australia fell by 0.4 per cent to 114.0 in the week ended 21 June 2015. However, the four-week moving average is now at 113.5, the highest level since November 2014, reflecting the more positive reaction to the Federal Budget. The sub-index for households’ finances in the next year fell by 1.1 per cent, while the sub-index for households’ finances compared with a year ago rose by 5.3 per cent.

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

ME Bank aims for rapid mortgage growth despite credit rules

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Original article by Clancy Yeates
The Australian Financial Review – Page: 19 : 23-Jun-15

Industry superannuation fund-backed ME Bank hopes to increase annual growth in home loan customers to 20 per cent over the next three years, according to CEO Jamie McPhee. This compares with its current growth rate of about 10 per cent a year. McPhee adds that a $A90m capital investment in ME Bank’s IT systems will increase efficiencies and support its growth ambitions by allowing the group to offer a wider range of home loan products.

CORPORATES
ME BANK, MEMBERS EQUITY BANK PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSSIE HOME LOANS LIMITED, MORTGAGE CHOICE LIMITED – ASX MOC

RBA tool blunted: ANZ

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 21 : 22-Jun-15

The Reserve Bank of Australia’s policy of reducing interest rates was intended to encourage consumers to spend. However, ANZ Bank economists have concluded that people nearing retirement are in fact saving rather than spending. They also note that older Australians are also saving more as a result of uncertainty concerning superannuation policy.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

RBA must cut again to weaken $A as Fed takes dovish view

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Original article by Vesna Poljak
The Australian Financial Review – Page: 24 : 19-Jun-15

Many Australian economists now expect the US Federal Reserve to delay a rate cut until December 2015, in the wake of its June monetary policy meeting. The central bank gave indications that any rate rises over the next several years will be at a slower pace than previously expected. This in turn has heightened expectations that the Reserve Bank will further reduce interest rates, in order to put downward pressure on the Australian dollar.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, RESERVE BANK OF AUSTRALIA, CITIGROUP PTY LTD, WESTPAC BANKING CORPORATION – ASX WBC, UBS HOLDINGS PTY LTD

Cash Converters to settle payday lending class action

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Original article by James Eyers
The Australian Financial Review – Page: 23 : 18-Jun-15

Cash Converters is close to settling a class action in which it was alleged to have charged exorbitant interest rates on payday loans. Its shares are in a trading halt pending the settlement, and the stock is expected to resume trading on 19 June 2015. Law firm Maurice Blackburn, which led the class action on behalf of about 50,000 customers on low incomes, alleged that Cash Converters charged interest rates of between 145 and 633 per cent.

CORPORATES
CASH CONVERTERS INTERNATIONAL – ASX CCV. MAURICE BLACKBURN PTY LTD. MONEY3 CORPORATION LIMITED – ASX MNY. AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Westpac sells down BT stake for $700m gain

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Original article by Clancy Yeates, James Thomson, Jonathan Shapiro
The Australian Financial Review – Page: 15 & 18 : 17-Jun-15

TS Lim of Bell Potter suggests that Westpac’s move to trim its 59 per cent stake in BT Investment Management is primarily aimed at lifting the bank’s capital ratio. Westpac plans to offload about 82 million shares in BT, which will raise between $A600m and $A700m while reducing its stake in the listed fund manager to 31-40 per cent. The bulk of Westpac’s BT shares will be offered to institutional investors via a bookbuild, while about 27 million will be made available to the retail shareholders of both Westpac and BT.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, BT INVESTMENT MANAGEMENT LIMITED – ASX BTT, BELL POTTER SECURITIES LIMITED, BT FINANCIAL GROUP PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, STANDARD AND POOR’S ASX 200 INDEX, STANDARD AND POOR’S ASX ALL ORDINARIES INDEX

Banks shine says Credit Suisse note

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Original article by Jens Meyer
The Australian Financial Review – Page: 29 : 17-Jun-15

Credit Suisse has upgraded its recommendation on the ANZ Bank from "neutral" to "outperform". The firm has cited factors such its higher growth in earnings per share than rival banks and the fact that ANZ shares offer value in the wake of the recent selldown. Meanwhile, eleven out of 19 analysts polled by Bloomberg have a "buy" recommendation on ANZ. Credit Suisse also has an "outperform" rating on National Australia Bank, and a "neutral" rating on Westpac and the Commonwealth Bank.

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BLOOMBERG LP

ANZ-Roy Morgan Consumer Confidence Back to Recent Highs

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

The ANZ-Roy Morgan Consumer Confidence rating for Australia rise by 2.1 per cent to 114.5 in the week ended 14 June 2015, reversing the falls in the previous three weeks. Confidence now stands above the long-run average and just a touch below the post-Federal Budget reaction. The sub-index for households’ finances in the next year has risen by 3.6 per cent, while the sub-index for expectations of the economic outlook in the next year rose by 4.1 per cent.

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