K62 Finance

Rates to stay low ‘for decades’: RBA

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Original article by Cliona O’Dowd
The Australian – Page: 19 & 29 : 14-Feb-20

Reserve Bank governor Philip Lowe has conceded that the coronavirus outbreak is likely to have a near-term impact on the economy, although he does not expect the outlook for 2020 to be significantly affected. He adds that the Australian economy will benefit from stimulus measures in China when the virus is brought under control. Lowe has also warned that climate change has ‘profound’ economic implications for Australia, while he says official interest rates may remain low for a long time.

CORPORATES
RESERVE BANK OF AUSTRALIA

NAB may delay MLC split after sound result

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Original article by Richard Gluyas
The Australian – Page: 23 : 14-Feb-20

A trading update from National Australia Bank shows that it booked a cash profit of $1.65bn for the first quarter of its financial year. This is one per cent higher than the quarterly average for the second half of fiscal 2019. Revenue increased by less than one per cent for the quarter, while expenses were three per cent higher. Meanwhile, NAB has signalled that the proposed demerger of its MLC wealth management could be postponed due to the challenging business conditions at present.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED

CBA to grab bigger share of business

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Original article by James Frost
The Australian Financial Review – Page: 1 & 20 : 13-Feb-20

The Commonwealth Bank of Australia has posted a 2019-20 interim cash profit of $4.47bn; this is 4.3 per cent lower than previously, although analysts had expected a larger decline. CEO Matt Comyn notes that CBA recorded growth in home lending, business lending and deposits during the half-year, and he has flagged plans to seek an even greater share of the business lending market. Comyn adds that CBA’s investment in digital banking has enabled it to build market share among younger customers; this is also a segment that it will target for further growth.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

When it comes to compensation payouts, NAB’s $204m leads the pack

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Original article by Richard Gluyas
The Australian – Page: 19 : 12-Feb-20

Data from the Australian Securities & Investments Commission shows that National Australia Bank customers have now received $203.8m in compensation for poor financial advice and services that were not provided. The Commonwealth Bank in turn has paid out $174.2m, ahead of AMP ($167.2m), Westpac ($106.4m), the ANZ Bank ($95.6m) and Macquarie Group ($2.6m).

CORPORATES
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AMP LIMITED – ASX AMP, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, MACQUARIE GROUP LIMITED – ASX MQG

Westpac lifeline for virus-plagued customers

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Original article by Glenda Korporaal
The Australian – Page: 19 : 12-Feb-20

Westpac has revealed details of its support package for businesses that have been impacted by the coronavirus. Amongst other things, it will allow business loan repayments to be deferred for up to three months, while businesses will also be able to extend their loans for up to three months. Westpac offered similar relief to bushfire victims. Businesses across the economy have been impacted by the virus outbreak, including tourism operators and fresh food exporters.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC

CBA under pressure to deliver perfect result

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Original article by James Frost, James Thomson
The Australian Financial Review – Page: 15 : 10-Feb-20

The consensus of analysts polled by Bloomberg is for the Commonwealth Bank of Australia to post a 2019-20 interim cash profit of $4.34bn. This compares with $4.68bn for the first half of 2018-19. The bank’s share price has gained 10 per cent in the last three months, leaving the stock vulnerable to a pullback if investors are disappointed by the interim result. Most analysts do not expect CBA to announce a special dividend or a share buyback.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BLOOMBERG LP

Virus fears, rate uncertainty push $A to worst January since 2015

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Original article by Timothy Moore
The Australian Financial Review – Page: 20 : 3-Feb-20

The Australian dollar has shed 4.7 per cent so far in 2020, and factors such as the coronavirus and the prospect of further interest rate cuts could see the currency test a new post-global financial crisis low. The Reserve Bank of Australia is now widely tipped to reduce the cash rate in April, although Prashant Newnaha of TD Securities says a rate cut in March is still possible. The RBA is expected to downgrade its economic growth forecasts on 7 February, and National Australia Bank economist Kaixin Owyong says this means that further rate cuts will be necessary.

CORPORATES
RESERVE BANK OF AUSTRALIA, TD SECURITIES, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Hayne casualties in limbo a year after the inquiry

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Original article by James Frost, Aleks Vickovich, James Eyers, Sally Patten
The Australian Financial Review – Page: 1 & 10 : 31-Jan-20

Terry McMaster claims the Hayne royal commission, which handed down its final report in February 2019, was a waste of time and money. McMaster, the former head of Dover Financial, is the only person to be convicted as a direct consequence of the commission thus far. A number of high-profile executives left the financial services sector after appearing before the commission, or being implicated in evidence presented to it; only a small number of those individuals have returned to corporate life. One witness has stated they felt they were abandoned by their company after appearing before the commission, while some hold the view that women wore the burden of the commission disproportionately to men.

CORPORATES
DOVER FINANCIAL ADVISERS PTY LTD, AMP LIMITED – ASX AMP, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, IOOF HOLDINGS LIMITED – ASX IFL, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC

Consensus shifts to April cut after NAB relents

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Original article by Sarah Turner
The Australian Financial Review – Page: 30 : 31-Jan-20

The futures market is currently pricing in a 10.4 per cent chance that the Reserve Bank of Australia will reduce the cash rate on 4 February, compared with a 53 per cent chance in mid-January. National Australia Bank’s chief economist Alan Oster previously expected a rate cut in February, and while he still believes that the RBA should so, he says the next rate cut is now likely to be in April. The other major banks also expect an official interest rate cut in April.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, RESERVE BANK OF AUSTRALIA

Home loan customers reward ME Bank with highest satisfaction rating

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Original article by Roy Morgan
Market Research Update – Page: Online : 30-Jan-20

New Roy Morgan banking data shows that ME Bank has the leading satisfaction rating (91.4%) among home loan customers. ING remains in top position among non-home loan customers with a rating of 89.8%. Among home loan customers, ME Bank is followed by ING (89.3%), Bendigo Bank (83.3%) and Bankwest (77.1%). For non-home loan customers, leader ING is followed by Bendigo Bank (87.8%), ME Bank (83.5%) and Suncorp (81.0%). The institution with the largest discrepancy between home loan and non-home loan customer satisfaction is Suncorp, where the satisfaction rating among home loan customers (72.6%) is more than 8 percentage points below its rating among non-home loan customers (81.0%). The ratings are taken from the Roy Morgan Single Source survey, compiled by in-depth face-to-face interviews with around 50,000 Australians each year in their homes.

CORPORATES
ROY MORGAN LIMITED, ME BANK, ING BANK (AUSTRALIA) LIMITED, BENDIGO BANK, BANKWEST, SUNCORP BANK