K62 Finance

Aussie dollar under threat as US Fed talks rate rise

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Original article by John Kehoe
The Australian Financial Review – Page: 1 & 36 : 19-Sep-14

The US Federal Open Market Committee has signalled that interest rates are likely to rise by the end of 2015. This prompted renewed support for the US dollar on 18 September 2014, while the yield on US 10-year bonds increased to 2.61 per cent and the Australian dollar reached a six-month low of $US0.8938. The Australian dollar is likely to come under further selling pressure when the US does begin tightening monetary policy

CORPORATES
UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, UNITED STATES. FEDERAL RESERVE BOARD, STANDARD AND POOR’S ASX 200 INDEX, DELTEC INTERNATIONAL GROUP, GROUP OF TWENTY (G-20), RESERVE BANK OF AUSTRALIA, PEOPLE’S BANK OF CHINA, BANK OF ENGLAND, FINANCIAL STABILITY BOARD, INTERNATIONAL MONETARY FUND, TRILOGY GLOBAL ADVISORS LLC, AUSTRALIA. FUTURE FUND MANAGEMENT AGENCY, AUSTRALIA. DEPT OF THE TREASURY, BANK OF JAPAN, EUROPEAN CENTRAL BANK, BANK OF AMERICA CORPORATION, MERRILL LYNCH AND COMPANY INCORPORATED, CNBC, PNC ASSET MANAGEMENT, BOSTON ADVISORS LLC

Banks set to dodge ‘bail-in’ measures

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Original article by Clancy Yeates, Jonathan Shapiro
The Australian Financial Review – Page: 24 : 18-Sep-14

The Australian Government is likely to reject a "bail-in" regime for large banks. The proposed rule for the largest 29 banks would bail in some bondholders if a bank collapsed, rather than using taxpayer funds. Australian Prudential Regulation Authority Wayne Byres said that there were practical difficulties in introducing a bail-in regime. Moody’s Investors Service said that the regime could reduce access to funding. However, Australia’s membership of the Financial Stability Board may force it to accept the regime

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, MOODY’S INVESTORS SERVICE INCORPORATED, FINANCIAL STABILITY BOARD, GROUP OF TWENTY (G-20), COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Anchorage Capital reaps big from Dick Smith sellout

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Original article by Eli Greenblat
The Age – Page: 21 : 16-Sep-14

Anchorage Capital will make almost $A370 million from its investment in consumer electronics business Dick Smith. The private equity firm bought the struggling business for $A94 million in September 2012. It was floated in December 2013, giving Anchorage a profit of $A264 million. In mid-September 2014, Anchorage sold its remaining 20 per cent stake at $A2.22 a share

CORPORATES
DICK SMITH HOLDINGS LIMITED – ASX DSH, ANCHORAGE CAPITAL PARTNERS PTY LTD, MACQUARIE CAPITAL PTY LTD, WOOLWORTHS LIMITED – ASX WOW

Lower $A ‘a wake-up call’

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Original article by Bianca Hartge-Hazelman, Jonathan Shapiro
The Australian Financial Review – Page: 29 : 15-Sep-14

The Australian dollar was heavily sold down in the week ended 13 September 2014. The currency was trading at $US0.904, and Aitken Advisors’ James Aitken says it needs to fall much further in order to benefit the economy. He suggests that an appropriate level for the currency may be around $US0.80, while Warren Hogan of the ANZ Bank forecasts that it will fall to $US0.88 by the end of the year

CORPORATES
AITKEN ADVISORS LLP, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NINE NETWORK AUSTRALIA LIMITED, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, EUROPEAN CENTRAL BANK, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, QIC LIMITED, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE

$A correction ‘overdue’

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Original article by Mark Mulligan, Jonathan Shapiro
The Australian Financial Review – Page: 29 : 11-Sep-14

The Australian dollar was sold down on 10 September 2014, reaching an intra-day low of $US0.9130. The currency had not fallen below $US0.92 since March, and the sell-down was prompted by factors such as growing expectations that interest rates in the US will be increased sooner rather than later. David Bassanese of BetaShares says a correction in the value of the dollar would have occurred earlier if interest rates had not been slashed in Europe and Japan recently

CORPORATES
BETASHARES CAPITAL LIMITED, UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, CREDIT SUISSE (AUSTRALIA) LIMITED, BANK OF ENGLAND, WESTPAC BANKING CORPORATION – ASX WBC, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, RESERVE BANK OF AUSTRALIA, ABERDEEN ASSET MANAGEMENT LIMITED

$A correction ‘overdue’

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Original article by Mark Mulligan, Jonathan Shapiro
The Australian Financial Review – Page: 29 : 11-Sep-14

The Australian dollar was sold down on 10 September 2014, reaching an intra-day low of $US0.9130. The currency had not fallen below $US0.92 since March, and the sell-down was prompted by factors such as growing expectations that interest rates in the US will be increased sooner rather than later. David Bassanese of BetaShares says a correction in the value of the dollar would have occurred earlier if interest rates had not been slashed in Europe and Japan recently

CORPORATES
BETASHARES CAPITAL LIMITED, UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, CREDIT SUISSE (AUSTRALIA) LIMITED, BANK OF ENGLAND, WESTPAC BANKING CORPORATION – ASX WBC, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, RESERVE BANK OF AUSTRALIA, ABERDEEN ASSET MANAGEMENT LIMITED

BCA cautions against hasty bank reforms

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Original article by Annabel Hepworth
The Australian – Page: 19 : 9-Sep-14

The Business Council of Australia (BCA) has lodged its submission for the second round of the Federal Government’s new financial system review, conducted by ex-Commonwealth Bank of Australia CEO David Murray. The BCA argues against more stringent capital requirements for large banks, as this could have a knock-on effect on all enterprises via higher borrowing costs. The issue of how to handle banks deemed "too big to fail" will also be discussed at the upcoming Group of 20 summit in Australia

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BUSINESS COUNCIL OF AUSTRALIA, GROUP OF TWENTY (G-20), MOODY’S INVESTORS SERVICE INCORPORATED

Big four banks facing strong competition selling superannuation to their customers

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 4-Sep-14

A Roy Morgan Research Consumer Single Source survey has found that National Australia Bank had an 18.4 per cent share of its customers’ superannuation wallet in the year to July 2014. This compares with 20.5 per cent in the year to July 2010. The Commonwealth Bank now has a 13.2 per cent share of its customers’ super wallet, followed by Westpac with 13 per cent. Meanwhile, industry super funds hold around 25 per cent of bank customers’ super wallet, while AMP holds about six per cent

CORPORATES
ROY MORGAN RESEARCH LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AMP LIMITED – ASX AMP

Murray review could lift costs

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Original article by Kylar Loussikian
The Australian – Page: 18 : 4-Sep-14

JPMorgan banking analyst Scott Manning warns that wholesale funding costs in the banking sector may rise some $A2.2bn, if recommendations likely to be made by the Australian Government’s new financial system review are adopted. A major issue is potentially more stringent capital requirements to fund home mortgage lending. Interest rate discounts on such loans offered by the main banks have grown to between 1% and 1.4% from 0.2% in 2009

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, JP MORGAN AUSTRALIA LIMITED

Consumer confidence improving

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Original article by Shane Wright
The West Australian – Page: 8 : 4-Sep-14

There has been a one per cent increase in the number of Western Australians who anticipate an improvement in the state’s economy. Likewise, the latest consumer confidence data from the Chamber of Commerce & Industry of Western Australia shows there has been a five per cent fall in the number of people who anticipate that the economy will deteriorate. Meanwhile, state final demand declined by 0.3 per cent in the June 2014 quarter

CORPORATES
CHAMBER OF COMMERCE AND INDUSTRY OF WESTERN AUSTRALIA (INCORPORATED), AMP LIMITED – ASX AMP