K62 Finance

APRA to unveil CBA report this week

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Original article by James Eyers
The Australian Financial Review – Page: 19 : 30-Apr-18

An independent panel has spent more than six months examining the Commonwealth Bank’s governance and culture on behalf of the Australian Prudential Regulation Authority. The panel, which consists of corporate director Jillian Broadbent, former Australian Competition & Consumer Commission chairman Graeme Samuel and former APRA chairman John Laker, is due to report its findings to APRA on 30 April, with APRA to make the findings public in the next few days. It is likely that the panel will be critical of a lack of emphasis on risk culture at the bank, and of its investments in risk systems.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE

APRA ends investor loan growth cap

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Original article by James Thomson, Jonathan Shapiro
The Australian Financial Review – Page: 15 : 27-Apr-18

Australian Prudential Regulation Authority chairman Wayne Byres says the major banks have improved their lending standards, so a 10 per cap on growth in lending to residential property investors is no longer necessary. The cap will no longer enforced if banks can demonstrate that they have remained below it for the last six months and that they have complied with APRA’s requirements with regard to loan serviceability. Omkar Joshi of Regal Funds Management does not expect removing the cap to have a significant impact on the banks, given that their lending growth is below this level.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, REGAL FUNDS MANAGEMENT PTY LTD, UBS HOLDINGS PTY LTD, CLSA AUSTRALIA PTY LTD, TEACHERS MUTUAL BANK LIMITED

CBA looks at selling advice firms

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Original article by James Eyers
The Australian Financial Review – Page: 13 : 24-Apr-18

The Commonwealth Bank is said to be reviewing its ownership of the Count Financial and Financial Wisdom financial planning groups. An announcement on a possible sale of the two groups could be made in the second half of 2018. The banking royal commission’s revelations have prompted banks to consider their ownership of financial planning groups, amid concern about the potential for conflicts of interests. The CBA paid $A373 million for Count Financial in 2011, while it assumed ownership of Financial Wisdom when it acquired the Colonial Group in 2000.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, COUNT FINANCIAL LIMITED, FINANCIAL WISDOM LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, COLONIAL GROUP, UBS HOLDINGS PTY LTD, SHAW AND PARTNERS LIMITED

CBA charges dead customers for advice

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Original article by James Frost
The Australian Financial Review – Page: 9 : 20-Apr-18

The Commonwealth Bank of Australia has apologised to the families of deceased customers who had continued to be charged fees for financial advice after their death. The banking royal commission has been told that four deceased customers of CBA subsidiary Count Financial had been charged fees, in one case for more than 10 years after their death. The inquiry has also been told that CBA had been made aware of a fees-for-no-service scandal at Count Financial in November 2012, but it did not inform ASIC until 2014.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, COUNT FINANCIAL LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, DELOITTE TOUCHE TOHMATSU LIMITED, AMP LIMITED – ASX AMP, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC

CBA reputation hammered by series of scandals

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Original article by James Thomson
The Australian Financial Review – Page: 13 & 18 : 19-Apr-18

The Commonwealth Bank is rated 57th in the Reputation Institute’s latest Australian Corporate Reputation Index, compared with 36th previously. The index was compiled in February and March, and followed a series of scandals and executive departures at the bank. However, the positions of Australia’s other three major banks were largely unchanged in the latest index. Air New Zealand has the highest ranking in the index for the second successive year, followed by Toyota and Qantas.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, REPUTATION INSTITUTE PTY LTD, AIR NEW ZEALAND LIMITED – ASX AIZ, TOYOTA MOTOR CORPORATION AUSTRALIA LIMITED, QANTAS AIRWAYS LIMITED – ASX QAN, BHP BILLITON LIMITED – ASX BHP, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, SUNCORP GROUP LIMITED – ASX SUN, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, AUSTRALIANSUPER PTY LTD, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, RIO TINTO LIMITED – ASX RIO, MYER HOLDINGS LIMITED – ASX MYR, APPLE PTY LTD, MURRAY GOULBURN CO-OPERATIVE COMPANY LIMITED, ORIGIN ENERGY LIMITED – ASX ORG, AGL ENERGY LIMITED – ASX AGL, ENERGYAUSTRALIA PTY LTD

RBA talks up rate rise, but not just yet

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Original article by David Rogers
The Australian – Page: 17 & 24 : 18-Apr-18

The minutes of the Reserve Bank’s latest board meeting show that board members expect monetary policy to be tightened rather than eased, although they have indicated that this is unlikely in the near-term given the outlook for inflation and unemployment. Meanwhile, Bill Evans of Westpac says the central bank is likely to downgrade its growth forecast for the Australian economy in 2018 from 3.25 per cent to three per cent in its next statement on monetary policy.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, UBS HOLDINGS PTY LTD, CAPITAL ECONOMICS LIMITED

Banks discuss new standards council option

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Original article by James Frost, James Eyers
The Australian Financial Review – Page: 17 : 16-Apr-18

The second week of the banking royal commission’s public hearings will commence on 16 April, with financial planning to be the initial focus. AMP executive Anthony Jack Regan and Australian Securities & Investments Commission deputy chairman Peter Kell are both expected to appear before the commission on 16 April. Meanwhile, talks involving the formation of a Professional Banking Council are continuing, with banks, regulators and industry associations involved in the discussions.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES, AMP LIMITED – ASX AMP, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, FINANCIAL SERVICES INSTITUTE OF AUSTRALASIA, AUSTRALIAN BANKERS’ ASSOCIATION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

First rate rise will shock, warns RBA’s Lowe

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Original article by Jacob Greber
The Australian Financial Review – Page: 10 : 12-Apr-18

Reserve Bank of Australia governor Philip Lowe has reiterated that there is likely to be a gradual increase in economic growth and wages, which should ensure that interest rates remain on hold in the near-term. Lowe also used an Australia-Israel Chamber of Commerce speech to emphasise that the cash rate is expected to rise rather than fall when the central bank next adjusts monetary policy, and he noted that interests have not risen for more than seven years. Some economists now expect the cash rate to remain at 1.5 per cent until 2020.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA-ISRAEL CHAMBER OF COMMERCE

Westpac reveals tough move against liar loans

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Original article by Duncan Hughes
The Australian Financial Review – Page: 34 : 12-Apr-18

Westpac will introduce stricter disclosure criteria for people seeking a home loan from mid-April. Amongst other things, mortgage applications will be required to provide more extensive information on their expenditure in order to qualify for a loan. The move is aimed at cracking down on so-called "liar loans". Independent analysis suggests that about 20 per cent of mortgage applications overstate their income and almost 50 per cent understate their expenditure.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, BANK OF MELBOURNE LIMITED, ST GEORGE BANK LIMITED, BANK OF SOUTH AUSTRALIA LIMITED, EQUIFAX INCORPORATED, EXPERIAN AUSTRALIA PTY LTD, ILLION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Inquiry can be a circuit breaker

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Original article by David Rogers, Ben Butler
The Australian – Page: 17 & 26 : 10-Apr-18

Former Westpac CEO David Morgan says he is unsure whether the bonus schemes used by banks deliver high levels of integrity. Morgan values the importance of a productive workplace culture that is combined with high integrity. He thinks the financial services royal commission could act as a "circuit breaker" for the banks in improving their reputations in the wake of a series of scandals. The wealth management arms of the big four banks will come under the commission’s scrutiny when it begins its next round of hearings in the week beginning 16 April.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. DEPT OF THE TREASURY