K62 Finance

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

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

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

Correction in housing market ‘inevitable’

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Original article by Damon Kitney
The Australian – Page: 21 : 3-Sep-14

Residential real estate prices have risen an average 15% in a year in the Australian state and territory capital markets, while auction clearance rates in late August 2014 are around 70%. Australian Prudential Regulation Authority data also indicate that the main four banks are taking on riskier mortgage loan borrowers. However business leader David Gonski says while an eventual price decline is a certainty in the housing market, the banks are able to manage their lending strategies

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, SCHULTE RESEARCH INTERNATIONAL

Investors back secret BoQ, Suncorp merger talks

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Original article by James Chessell, Sarah Thompson, Ruth Liew, Shaun Drummond
The Australian Financial Review – Page: 1 & 45 : 3-Sep-14

Jan van der Schalk of CLSA believes that there were merits to the proposed merger between Suncorp Group’s banking division and the Bank of Queensland (BoQ). Ausbil Dexia’s Paul Xiradis says any such deal would have been well received by the market, but notes that the groups’ focus on Queensland could be a concern. It has been revealed that Suncorp and BoQ abandoned preliminary merger talks earlier in 2014. Chris Hall of Argo Investments says the resignation of BoQ CEO Stuart Grimshaw means further merger talks are unlikely

CORPORATES
SUNCORP GROUP LIMITED – ASX SUN, BANK OF QUEENSLAND LIMITED – ASX BOQ, CLSA AUSTRALIA PTY LTD, AUSBIL DEXIA LIMITED, ARGO INVESTMENTS LIMITED – ASX ARG, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, UBS HOLDINGS PTY LTD, PROMINA GROUP LIMITED, EZCORP INCORPORATED, VIRGIN MONEY (AUSTRALIA) PTY LTD, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, AUSTRALIAN ASSOCIATED MOTOR INSURERS LIMITED, GIO AUSTRALIA LIMITED, BELL POTTER SECURITIES LIMITED, BELL FINANCIAL GROUP LIMITED – ASX BFG

Qantas set to beat Virgin in race to get back in the black

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Original article by Jamie Freed
The Australian Financial Review – Page: 15 & 20 : 2-Sep-14

Qantas and Virgin Australia both posted losses for the 2013-14 financial year, and cost-reduction measures will be a key strategy in their return to profitability. Analysts forecast that Qantas will book a profit of about $A66m for 2014-15, while Virgin is not tipped to be in the black until 2015-16. Meanwhile, Virgin will gain $A336m from the sale of a 35 per cent stake in its frequent flyer program to Affinity Equity Partners

CORPORATES
QANTAS AIRWAYS LIMITED – ASX QAN, VIRGIN AUSTRALIA HOLDINGS LIMITED – ASX VAH, VELOCITY FREQUENT FLYER PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, CLSA AUSTRALIA PTY LTD, CITIGROUP PTY LTD, AFFINITY EQUITY PARTNERS (AUSTRALIA) PTY LTD, MERRILL LYNCH (AUSTRALIA) PTY LTD, AIR NEW ZEALAND LIMITED – ASX AIZ, SINGAPORE AIRLINES LIMITED, ETIHAD AIRWAYS, VIRGIN GROUP LIMITED, TIGER AIRWAYS AUSTRALIA PTY LTD

FSI should focus on transparency, says fundie

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 15 & 20 : 2-Sep-14

The Australian Government’s financial system inquiry should focus on transparency and conflicts of interests. David Booth, co-founder of Dimensional Fund Advisors, says governments tend to over-react when the banking system is under strain. Over-regulation will not prevent future problems if the potential for conflicts of interests is not eliminated. Dimensional Fund Advisors does not pay commissions to financial advisers

CORPORATES
DIMENSIONAL FUND ADVISORS INCORPORATED, THE VANGUARD GROUP INCORPORATED

APRA hints at shifting capital

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Original article by Michael Bennet
The Australian – Page: 16 : 1-Sep-14

The Australian Prudential Regulation Authority has lodged its submission to the Federal Government’s financial system review. The watchdog wants global rules for the banking sector that require greater capital reserves for mortgage lending to apply locally. It is also sharing concerns of the Reserve Bank of Australia that more liberal lending standards could create unsustainable prices in the residential real estate market. Banks using advanced systems can access public guarantees at a lower cost

CORPORATES
BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, MACQUARIE BANK LIMITED – ASX MBL, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, RESERVE BANK OF AUSTRALIA, DEUTSCHE BANK AG

Macquarie hits political opposition in US network plan

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Original article by John Kehoe
The Australian Financial Review – Page: 15 & 19 : 1-Sep-14

The Utah Taxpayers Association opposes Macquarie Group’s proposal to complete the construction of an open-access broadband network in the state. Work on the Utah Telecommunication Open Infrastructure Agency (UTOPIA) project started about 10 years ago, and Macquarie wants to finance completion of the network. The original proposal was for the network to cover 11 cities in Utah

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, UTAH TELECOMMUNICATION OPEN INFRASTRUCTURE AGENCY (UTOPIA), UTAH TAXPAYERS ASSOCIATION, CENTURYLINK, COMCAST CORPORATION, MACQUARIE CAPITAL PARTNERS LLC, ECONOWEST ASSOCIATES