K62 Finance

Lib MP growls over layer of BEAR red tape

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Original article by Phillip Coorey
The Australian Financial Review – Page: 4 : 6-Feb-18

The Greens will seek amendments to the Federal Government’s Banking Executive Accountability Regime in the Senate, after the legislation was passed by the lower house on 5 February. Liberal MP Nicolle Flint opposed the BEAR regime, arguing that it will further increase the compliance burden for the financial sector, noting that it has been subject to a spate of new rules and regulations in recent years. The BEAR regime, which is slated to take effect in July, has the support of the Australian Labor Party.

CORPORATES
LIBERAL PARTY OF AUSTRALIA, AUSTRALIAN GREENS, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY

Why the RBA will hike interest rates

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Original article by Karen Maley
The Australian Financial Review – Page: 30 : 6-Feb-18

Ellerston Capital’s Tim Toohey expects the Reserve Bank to increase official interest rates by 125 basis points over the next three years, beginning in the second half of 2018. He says the prospect of higher interest rates will have relatively little impact on consumers, despite rising household debt, arguing that the net worth of Australian households has risen strongly over the last decade. Meanwhile, he attributes a slump in retail spending in the September 2017 quarter to the Federal Government’s changes in the rules on voluntary superannuation contributions rather than negative consumer sentiment.

CORPORATES
ELLERSTON CAPITAL PTY LTD, RESERVE BANK OF AUSTRALIA

Banks watch as capital city unit crisis unfolds

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Original article by Robert Gottliebsen
The Australian – Page: 21 : 31-Jan-18

The yield on US 10-year government bonds peaked at 2.73 per cent in late January, and the policies of President Donald Trump could see yields rise further. This would have major implications for Australia’s banks, which source 30-40 per cent of their funding from offshore. Australian banks are in turn heavily exposed to the residential and retail property markets, and a sharp rise in global interest rates would put downward pressure on asset values in these sectors. This would be of particular concern for the inner city apartment markets in Melbourne, Sydney and Brisbane, where there are already fears of an oversupply.

CORPORATES
UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Satisfaction with banks up in December

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Original article by Roy Morgan
Market Research Update – Page: Online : 31-Jan-18

New research from Roy Morgan shows that customer satisfaction with banks in the six months to December 2017 was 80.8%, up from 80.6% in November. Despite many fluctuations in satisfaction over the last two decades, the current result represents a continuation of the generally positive trend that we have seen since 2001, when satisfaction with banks was only 58.5%. The Commonwealth Bank had the highest customer satisfaction rating of the big four in December (unchanged at 79.6%), followed by NAB (up 0.3% to 78.6%). However, Bendigo Bank (up 0.7% to 88.8%) had the highest customer satisfaction rating among the 10 largest consumer banks.

CORPORATES
ROY MORGAN LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, BENDIGO BANK, BANK OF QUEENSLAND LIMITED – ASX BOQ, ING BANK (AUSTRALIA) LIMITED, BANK OF WESTERN AUSTRALIA LIMITED, ST GEORGE BANK LIMITED, SUNCORP BANK

Minefield for new CBA boss

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Original article by Glenda Korporaal, Michael Roddan
The Australian – Page: 1 & 6 : 30-Jan-18

The head of the Commonwealth Bank of Australia’s retail banking division, Matt Comyn, will succeed Ian Narev as CEO in April. His remuneration will be 15 per cent lower, with a base salary of $A2.2m plus short-term and long-term incentives. Comyn’s appointment follows a global search for Narev’s successor, and CBA chair Catherine Livingstone says Comyn had the board’s full support. CBA’s retail banking division has attracted scrutiny over a money-laundering scandal, but Livingstone stresses that it was a company-wide issue.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, FINANCE SECTOR UNION, BERRILL AND WATSON, COMMINSURE

Stronger $A a bump for RBA rate hike

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Original article by Patrick Durkin
The Australian Financial Review – Page: 26 : 29-Jan-18

The Australian dollar rose above $US0.81 in offshore trading on the weekend of 27-28 January, extending its gains since early December to eight per cent. Factors such as a falling US dollar and strengthening commodity prices have contributed to the Australian currency’s recent rally. However, the dollar’s rise may affect the timing of any change in official interest rates. Meanwhile, Citigroup expects the currency to be trading at around its current level at the end of 2018, although Westpac anticipates a fall of around $US0.09.

CORPORATES
CITIGROUP PTY LTD, WESTPAC BANKING CORPORATION – ASX WBC, AMP LIMITED – ASX AMP, RESERVE BANK OF AUSTRALIA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, UNITED STATES. FEDERAL RESERVE BOARD

ASIC slams banks over funds failure

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Original article by Michael Roddan
The Australian – Page: 15 & 18 : 25-Jan-18

A review of the financial advice industry by the Australian Securities & Investments Commission has focused on the four major banks and AMP, which collectively dominate the sector. The review concluded that there is a high level of non-compliance with laws requiring financial advisers to act in the best interests of their clients, with a majority of financial advisers recommending the banks’ own financial products rather than other ones on their approved product list. Financial planners will be subject to greater transparency with regard to approved product lists as a result of the review.

CORPORATES
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AMP LIMITED – ASX AMP, FINANCIAL SERVICES COUNCIL, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIAN GREENS, AUSTRALIAN CONSUMERS’ ASSOCIATION

Carnell: banking inquiry should pass the pub test

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Original article by James Frost
The Australian Financial Review – Page: 15 : 24-Jan-18

Complaints about loans to small business and farmers are among those on which the banking royal commission will accept submissions, according to information released on 23 January. Kate Carnell, the small business and family enterprise ombudsman, previously headed an inquiry into small business loans in 2016. She says the banking royal commission must ensure that all interested parties are given the opportunity to make a submission.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIA. OFFICE OF THE AUSTRALIAN SMALL BUSINESS AND FAMILY ENTERPRISE OMBUDSMAN

Banking inquiry to start next month

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Original article by Richard Gluyas
The Australian – Page: 18 : 23-Jan-18

The banking royal commission will hold its first public hearing on 12 February, while its website has begun accepting submissions about alleged misconduct in the financial services industry. The Consumer Action Law Centre has made the first of two submissions, in which it has called upon the royal commission to focus on misconduct that affects disadvantaged consumers in particular. Meanwhile, Craig Williams of Citigroup has downgraded the Commonwealth Bank to a "sell" recommendation in the wake of its money-laundering scandal.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, CONSUMER ACTION LAW CENTRE, CITIGROUP PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, HIGH COURT OF AUSTRALIA

UBS warning on household debt

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 21 : 19-Jan-18

New figures show that Australia’s household debt-to-income ratio has risen by three per cent to a record 199.7 per cent, which UBS notes is one of the world’s highest. The increase is largely due to the Australian Bureau of Statistics’ decision to include the debt of self-managed superannuation funds in the key indicator for the first time. UBS has forecast that the debt-to-income ratio will peak at around 205 per cent, and it has warned that rising household debt may affect demand for housing credit and the earnings of major banks. However, UBS is upbeat about the outlook for non-bank lenders.

CORPORATES
UBS HOLDINGS PTY LTD, AUSTRALIAN BUREAU OF STATISTICS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY