K62 Finance

Cheques dead and cash no longer king

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Original article by Shaun Drummond
The Australian Financial Review – Page: 3 : 6-Aug-14

The Australian Payments Clearing Association has issued a new study commissioned from the RFi consultancy firm. The "Milestones Report" predicts the share of all transactions that is accounted for by cash to decline by 20% to just 43% in the period to 2018. The use of cheques has also dropped 12.5% in 2012 and 13.3% in 2013, and by 2018 there may be few businesses left that still accept them. Credit cards and the eftpos system are tipped to each hold 24% of the payments market by 2018, while new solutions using smartphones will grow their share from 2% to 12%

CORPORATES
AUSTRALIAN PAYMENTS CLEARING ASSOCIATION LIMITED, RETAIL FINANCE INTELLIGENCE PTY LTD, PROPERTY EXCHANGE AUSTRALIA, MASTERCARD AUSTRALIA LIMITED, VISA INTERNATIONAL, EFT-POS AUSTRALIA PTY LTD, RESERVE BANK OF AUSTRALIA

Interest rates in state of suspension

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Original article by Jacob Greber
The Australian Financial Review – Page: 4 : 6-Aug-14

Riki Polygenis of the ANZ Bank says the Reserve Bank of Australia is likely to adopt a cautious approach to tightening monetary policy given the state of the economy. The central bank left the cash rate unchanged on 5 August 2014, and its monetary policy statement largely reiterated the views that were expressed in the previous month. Meanwhile, new data shows that the nation’s trade deficit blew out to $A4.8bn in the June quarter

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA, ROYAL BANK OF CANADA, JP MORGAN AUSTRALIA LIMITED

Big four banks lead lenders in slashing term deposit rates for savers

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Original article by Michael Bennet
The Australian – Page: 21 : 6-Aug-14

New data issued by Canstar show that Australia’s four main banks have taken the record low official cash interest rate as their cue to not only reduce home loan rates but the interest paid on term deposits. The five-year term rate has been cut by 15 basis points to 4.05% at National Australia Bank, and 20 basis points to 4.15% at Westpac Banking. A reduction of 40 basis points to 3.6% has also been announced by Suncorp. Commonwealth Bank of Australia had recently started a move by the major lenders to drop the fixed-rate mortgage rate to 4.99% for the first time ever

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, WESTPAC BANKING CORPORATION – ASX WBC, SUNCORP GROUP LIMITED – ASX SUN, CANSTAR PTY LTD, RESERVE BANK OF AUSTRALIA, DEUTSCHE BANK AG, HSBC BANK AUSTRALIA LIMITED, MACQUARIE BANK LIMITED – ASX MBL, MOODY’S INVESTORS SERVICE INCORPORATED, AUSSIE HOME LOANS LIMITED

Little joy for big four in Moody’s assessment

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Original article by Michael Bennet
The Australian – Page: 19 : 5-Aug-14

Credit ratings agency Moody’s Investors Service has commented on the findings of the Australian Government’s financial system inquiry. Its chair, David Murray, had rejected claims by the four main banks that they were facing an unduly harsh regulatory burden in the local roll-out of the Basel III reforms for the sector. Banks with domestic systemic importance, or those deemed "too big to fail", must increase their tier-one capital ratios. However Moody’s notes that its data show banks of a similar size overseas are no better off, and worse in the UK and Canada

CORPORATES
MOODY’S INVESTORS SERVICE INCORPORATED, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, BANK FOR INTERNATIONAL SETTLEMENTS. BASEL COMMITTEE ON BANKING SUPERVISION, UBS HOLDINGS PTY LTD

Treasury sets the pace for $3.4b offer

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Original article by Simon Evans, Sarah Thompson
The Australian Financial Review – Page: 15 & 20 : 5-Aug-14

Shares in Treasury Wine Estates closed $A0.20 higher at $A5.15 on 4 August 2014, in response to a revised takeover bid. Private equity firms Kohlberg Kravis Roberts (KKR) and Rhone Capital are offering $A5.20 per share, compared with KKR’s initial offer of $A4.70. Treasury has invited the bidders to undertake non-exclusive due diligence, and wants them to conclude the process as quickly as possible

CORPORATES
TREASURY WINE ESTATES LIMITED – ASX TWE, KKR AND COMPANY LP, KOHLBERG KRAVIS ROBERTS AND COMPANY, RHONE CAPITAL LLC, PENFOLDS WINES PTY LTD, WOLF BLASS WINES PTY LTD, LINDEMANS WINES PTY LTD, ROSEMOUNT ESTATES PTY LTD, WYNNS COONAWARRA ESTATE PTY LTD, FOSTER’S GROUP LIMITED

Confusion with Financial Planner independence continues

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

A Roy Morgan Research Consumer Single Source survey has found that considerable confusion remains among the users of Australian financial planners regarding the extent to which the planner is perceived to be independent. This is particularly so when the financial planner is branded differently to its parent company. For example, 55 per cent of clients of Commonwealth Bank-owned Financial Wisdom consider it to be independent, while just 14 per cent of clients consider Commonwealth Bank-branded planners to be independent

CORPORATES
ROY MORGAN RESEARCH LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, FINANCIAL WISDOM LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, GODFREY PEMBROKE FINANCIAL SERVICES LIMITED, RETIREINVEST PTY LTD, COUNT WEALTH ACCOUNTANTS, AMP LIMITED – ASX AMP, CHARTER FINANCIAL PLANNING LIMITED

Job ads, buoyant retail raise pressure on rates

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Original article by Adam Creighton
The Australian – Page: 19 : 5-Aug-14

There is no clear consensus among economists on whether the Reserve Bank of Australia will move to lift or cut the official cash interest rate late in 2014. No change is expected at the board meeting on 5 August, but a number of economic indicators have created uncertainty about the longer-term picture. Retailing sector sales had been forecast to grow a subdued 0.3% during June, but instead rose 0.6% to $A23.2bn. It appears consumer confidence dented by the harsh federal Budget in May is starting to recover. Help-wanted advertising is also up 4% in annualised terms

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, HSBC AUSTRALIA HOLDINGS PTY LTD

Start-ups key as change batters the big four

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Original article by Damon Kitney
The Australian – Page: 15 : 4-Aug-14

Consultants at Ernst & Young and KPMG warn that large companies must seek strategic alliances with small start-ups in order to safeguard against digital disruption. A major sector in need of such an approach is that of banking in Australia, and the four main lenders are already facing competition by online payments businesses such as PayPal. However Brian Hartzer, CEO Australian financial services at Westpac Banking, argues the banks can themselves behave like start-ups. Kelly Bayer Rosmarin, group executive institutional banking and markets at Commonwealth Bank of Australia, also says they have an advantage in the shape of large stores of customer data

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, PAYPAL INCORPORATED, AMAZON.COM INCORPORATED, KPMG, ERNST AND YOUNG

Banks may have to spin off trading

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Original article by John Kehoe, Jonathan Shapiro
The Australian Financial Review – Page: 1 & 10 : 4-Aug-14

Opinion is divided about the merits of restructuring banks to separate their retail and commercial banking arms from divisions such as insurance and funds management. David Murray, who is chairing the Australian Government’s inquiry into the financial system, has suggested that so-called "ring-fencing" should be examined in order to protect banks that are deemed "too big to fail". Similar laws have been introduced in the US and the UK, but Australian Bankers’ Association CEO Steve Munchenberg questions whether such reforms are needed in Australia

CORPORATES
AUSTRALIAN BANKERS’ ASSOCIATION, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, GREAT BRITAIN. DEPT OF THE TREASURY, JP MORGAN AND COMPANY INCORPORATED, AUSTRALIA. DEPT OF THE TREASURY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. FUTURE FUND MANAGEMENT AGENCY, BANK FOR INTERNATIONAL SETTLEMENTS. BASEL COMMITTEE ON BANKING SUPERVISION, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, UNITED STATES. FEDERAL RESERVE BOARD, MACQUARIE GROUP LIMITED – ASX MQG, SUNCORP GROUP LIMITED – ASX SUN, MOODY’S INVESTORS SERVICE INCORPORATED

Sharp end of PIN changes

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Original article by Shaun Drummond, Yolanda Redrup
The Australian Financial Review – Page: 6 : 1-Aug-14

Restaurant & Catering Australia CEO John Hart says the hospitality industry will incur higher costs due to the abolition of signatures for credit card transactions. He notes that most restaurants will need to buy additional mobile payment terminals in response to the PIN-only regime. Meanwhile, Melbourne restaurateur Eric Duong is concerned that older customers in particular may not have made the change to PINs

CORPORATES
RESTAURANT AND CATERING INDUSTRY ASSOCIATION OF AUSTRALIA INCORPORATED, MAN MO RESTAURANT, RETAIL FINANCE INTELLIGENCE PTY LTD, DAVID’S ZHOU ZHOU BAR AND ORIENTAL TEAHOUSE, TYRO PAYMENTS, PAYPAL INCORPORATED