K62 Finance

Brokers lift share of housing pie as bank branches lose business

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Original article by Richard Gluyas
The Australian – Page: 21 : 4-Sep-19

Data from UBS shows that Australia’s major banks account for 79 per cent of existing mortgage loans. However, Jon Mott of UBS says their share of new home loans is likely to keep falling as the trend toward alternatives such as mortgage brokers gathers pace. UBS also notes that the proportion of home loans that are sold via bank branches has fallen from 48 per cent in fiscal 2013 to just 37 per cent. Mott notes that the major banks’ aggressive push to close bank branches in recent years has contributed to the growing use of mortgage brokers.

CORPORATES
UBS HOLDINGS PTY LTD

ANZ boss braces for slowdown

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Original article by Richard Gluyas, Glenda Korporaal, David Rogers, Andrew White
The Australian – Page: 17 & 25 : 4-Sep-19

Harvey Norman chairman Gerry Harvey expects the Reserve Bank of Australia to reduce the cash rate to at least 0.5 per cent, but he says this will do little to stimulate the economy. The RBA signalled on 3 September that official interest rates are likely to remain low for an extended period; ANZ Bank CEO Shayne Elliott says record low interest rates demonstrate that central banks are concerned about the global economic outlook. The RBA’s monthly board meeting coincided with the release of data showing that retail spending fell by 0.1 per cent in July, compared with economists’ expectations of an 0.2 per cent increase.

CORPORATES
RESERVE BANK OF AUSTRALIA, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN BUREAU OF STATISTICS, AUSTRALIAN TAXATION OFFICE, LATITUDE FINANCIAL SERVICES AUSTRALIA HOLDINGS PTY LTD

Aviva tips weaker dollar, eyes global recession

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Original article by Adam Creighton
The Australian – Page: 17 & 18 : 2-Sep-19

Aviva Investors’ chief economist Michael Grady is bearish about the Australian dollar, saying that it could fall to the low $US0.60s level by the end of 2019. He stresses that the potential slump in the currency’s value is not solely due to the outlook for the Chinese economy, noting amongst other things that the link between the dollar and the terms of trade has broken down. Grady adds that the trade war with the US could reduce China’s economic growth by a further 1-1.25 per cent, while he says there is an even chance of a global recession before the end of 2019.

CORPORATES
AVIVA INVESTORS

Wary APRA orders more stress-tests for banks

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Original article by Richard Gluyas
The Australian – Page: 17 & 21 : 30-Aug-19

The Australian Prudential Regulation Authority currently undertakes "stress-testing" of the nation’s banks every three years. However, growing concern about the outlook for the domestic and global economies is believed to have prompted APRA to conduct annual stress tests. APRA’s latest corporate also shows that the performance of superannuation funds will also be a focus for the prudential regulator over the next few years; this will include ranking super funds based on a range of metrics.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Macquarie’s $1.6bn capital raise

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Original article by Joyce Moullakis
The Australian – Page: 17 & 21 : 29-Aug-19

Macquarie Group has advised that its profit for the six months to 30 September will be about 10 per cent higher than the $1.3bn result for the same period in 2018. Macquarie posted a record profit of $2.98bn for the year to 31 March, and Jonathan Mott of UBS has forecast a profit of $3.04bn for fiscal 2020. Meanwhile, Macquarie is seeking to raise $1bn from institutional investors and up to $600m from retail investors via a share purchase plan. Most of the proceeds will be invested in assets such renewable energy, technology and infrastructure.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, UBS HOLDINGS PTY LTD, CADENCE CAPITAL LIMITED – ASX CDT, MOODY’S INVESTORS SERVICE INCORPORATED, CITIGROUP PTY LTD

NPS of banks (and big four banks) continues to improve after Finance Royal Commission

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Original article by Roy Morgan
Market Research Update – Page: Online : 28-Aug-19

New results from Roy Morgan show that the Net Promoter Score levels of Australia’s banks, including the big four banks, have increased significantly since the final report of the Finance Royal Commission was handed down in February 2019. The NPS of the big four banks was 2.1 in July, up 3.7pts since February, and the NPS of banks as a whole was 8.5, up 3.2pts over the last five months. The improvement in NPS scores has returned the measure to a level comparable to that at the time the Finance Royal Commission was established in late 2017. All of the big four banks have improved their NPS since February. The leading big four bank by NPS is the CBA (now on 7.2, up 3.3pts since February). The other three, although improved, were still in negative territory. Teachers Mutual Bank now has the highest NPS of 52.6, up 13.5pts since February. Meanwhile, satisfaction with the big four banks reached 76.1% in July, up by 0.8% points since February, led by increases for the CBA (+1% point), ANZ (+0.9% points) and Westpac (+2.3% points). These are some of the latest findings from Roy Morgan’s ‘Customer Satisfaction report on Consumer Banking in Australia’ and the ‘Financial Institutions Advocacy Report’. These reports are based on in-depth interviews conducted face-to-face with over 50,000 consumers per annum in their homes.

CORPORATES
ROY MORGAN LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, BENDIGO BANK, ING BANK (AUSTRALIA) LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

Reserve Bank flags QE to lift stagnant economy

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Original article by David Rogers
The Australian – Page: 24 : 28-Aug-19

The Reserve Bank of Australia’s deputy governor Guy Debelle says the nation has been a major beneficiary of the rules-based global trading system, and he has warned that the current threats to this system present a major risk to both the Australian and global economies. Debelle has also used an Economic Society speech to indicate that the RBA could be open to quantitative easing if the cash rate falls to 0.5 per cent. However, David Plank of the ANZ Bank says the RBA is unlikely to pursue such a course of action unless the cash rate falls to 0.25 per cent or lower.

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

Savers at risk in bank, credit union data hack

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Original article by Joyce Moullakis
The Australian – Page: 19 : 26-Aug-19

The security of the New Payments Platform is under scrutiny in the wake of revelations that the system has been subject to a second data breach. Cuscal has indicated that only about three per cent of bank and credit union customers who have registered for a PayID have been affected by the breach, which equates to less than 92,000 customers. Westpac customers who use the real-time NPP system were affected by a data breach in June.

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

Report finds ANZ tribal, slow and lazy

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Original article by James Frost
The Australian Financial Review – Page: 12 : 23-Aug-19

ANZ chairman David Gonski has commented on a governance, culture and accountability self-assessment that the bank prepared for the Australian Prudential Regulation Authority. Shortcomings revealed in the document, which Gonski notes was prepared on a confidential basis, prompted APRA to impose a $500 million capital charge on the bank. Gonski says some of these shortcomings include a penchant for seeking short-term fixes and a lack of accountability.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Bank charges on deposits a possibility

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Original article by Matthew Cranston
The Australian Financial Review – Page: 10 : 23-Aug-19

Data from the Reserve Bank shows that nearly 10 per cent of the deposits held by Australia’s major banks received no interest prior to the official interest rate cut in July, while a similar proportion of deposits earned interest of less than 50 basis points. Swiss Re’s chief economist Jerome Haegeli says Australian banks could potentially begin charging customers to hold their deposits. Several banks in Europe have already announced such a move, while the Bank of New York Mellon did so in 2011.

CORPORATES
RESERVE BANK OF AUSTRALIA, SWISS REINSURANCE COMPANY, THE BANK OF NEW YORK MELLON CORPORATION, UBS AG, JYSKE BANK, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB