K63 Insurance and Superannuation Funds

Murray shoots down Hockey’s super kite

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Original article by Fleur Anderson, Ruth Liew
The Australian Financial Review – Page: 1 & 10 : 11-Mar-15

Business leaders have expressed reservations about the Australian Government’s proposal for superannuation to be used to finance home ownership. Financial system inquiry chairman David Murray and AMP CEO Craig Meller are among those who oppose the plan due to its potential effects on the nation’s retirement system. Finance Minister Mathias Cormann also spoke out against such a proposal in October 2014

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIA. DEPT OF FINANCE, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY, LIBERAL PARTY OF AUSTRALIA, MONASH UNIVERSITY, GEM CAPITAL FINANCIAL ADVICE, COMMITTEE FOR ECONOMIC DEVELOPMENT OF AUSTRALIA

Keating: don’t kill super

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Original article by Jacob Greber, Joanna Mather
The Australian Financial Review – Page: 1 & 6 : 10-Mar-15

Former prime minister Paul Keating says it would be irresponsible to allow young Australians to use their superannuation savings to buy their first home. Such a move, in his view, would destroy the superannuation system. Both Prime Minister Tony Abbott and Treasurer Joe Hockey believe that the idea of using super to finance the purchase of one’s first home is worth considering

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, LIBERAL PARTY OF AUSTRALIA, THE CENTRE FOR INDEPENDENT STUDIES LIMITED, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT, AUSTRALIAN COUNCIL OF SOCIAL SERVICE, FAIRFAX MEDIA LIMITED – ASX FXJ

Banks to put out welcome mats for the disruptors

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Original article by James Eyers
The Australian Financial Review – Page: 13 & 17 : 4-Mar-15

The New South Wales Government has unveiled plans for a financial technology hub in the Sydney CBD. The Stone & Chalk hub will receive financial backing from a range of companies, including major banks, insurers, retailers and technology groups. The hub will provide financial technology start-ups with subsidised office space and facilities to work with financial and technology companies to further develop their business

CORPORATES
NEW SOUTH WALES. DEPT OF PREMIER AND CABINET, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, AMP LIMITED – ASX AMP, MACQUARIE GROUP LIMITED – ASX MQG, HSBC AUSTRALIA HOLDINGS PTY LTD, SUNCORP BANK, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, WOOLWORTHS LIMITED – ASX WOW, VEDA GROUP LIMITED – ASX VED, AMERICAN EXPRESS COMPANY, AMAZON.COM INCORPORATED, INTEL CORPORATION, ORACLE CORPORATION, FINZSOFT SOLUTIONS (AUSTRALIA) PTY LTD, ALLENS, KPMG AUSTRALIA PTY LTD, CAPITAL MARKETS CO-OPERATIVE RESEARCH CENTRE LIMITED, CENTRE FOR INTERNATIONAL FINANCE AND REGULATION, FINANCIAL SERVICES INSTITUTE OF AUSTRALASIA, AWI VENTURES LIMITED, SOCIETYONE AUSTRALIA PTY LTD, LEVEL39, LIBERAL PARTY OF AUSTRALIA

Regulators examine super switch breaches

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Original article by Clancy Yeates
The Australian Financial Review – Page: 18 : 3-Mar-15

The Australian Prudential Regulation Authority will look into allegations that banks are illegally trying to gain market share in the superannuation sector. UMR Research has released the findings of a survey which suggests that banks have offered inducements to encourage employers to change their default super funds to those offered by the banks. The Financial Services Council says UMR should disclose which banks have offered incentives to switch default funds

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, UMR RESEARCH PTY LTD, FINANCIAL SERVICES COUNCIL, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. DEPT OF THE TREASURY, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, BT FINANCIAL GROUP PTY LTD

Responsible insurance-sale call repeated

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Original article by Shaun Drummond
The Australian Financial Review – Page: 19 : 2-Mar-15

Financial system inquiry member Craig Dunn says Australia should not follow the European Union by introducing an individual appropriateness test for the insurance industry. He argues that such a test would result in significant costs for the industry. He says the inquiry instead favours an increased obligation on the part of product issuers and distributors to act responsibly when selling insurance products

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, FINANCIAL SERVICES COUNCIL, GREAT BRITAIN. FINANCIAL CONDUCT AUTHORITY, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, CLYDESDALE BANK PLC, INSURANCE COUNCIL OF AUSTRALIA LIMITED

IFM to invest in international equities

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Original article by Amanda Saunders
The Australian Financial Review – Page: 27 : 2-Mar-15

IFM Investors will expand into international shares, as part of its growing push to diversify beyond Australian asset classes. CEO Brett Himbury argues that the nation’s superannuation system needs to reduce its focus on the local sharemarket, noting that many of the group’s clients already have exposure to offshore equities. IFM began investing in overseas infrastructure assets several years ago

CORPORATES
IFM INVESTORS PTY LTD, MAGELLAN FINANCIAL GROUP LIMITED – ASX MFG, PLATINUM ASSET MANAGEMENT LIMITED – ASX PTM

QBE swings to profit after North American sell-off

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Original article by Ruth Liew
The Australian Financial Review – Page: 15 & 22 : 25-Feb-15

QBE Insurance Group has posted a 2014 profit of $US742m ($A950m), following a loss of $US254m previously. Revenue was six per cent lower at $US18.23bn, while it boasted an insurance profit margin of 7.6 per cent. QBE will gain $US95m from the sale of its workers’ compensation business in Argentina, which follows asset sales in 2014. Shareholders will receive a final dividend of $A0.22 per share

CORPORATES
QBE INSURANCE GROUP LIMITED – ASX QBE, STEADFAST GROUP LIMITED – ASX SDF, WESTPAC BANKING CORPORATION – ASX WBC, GENWORTH MORTGAGE INSURANCE AUSTRALIA LIMITED – ASX GMA, NIKKO ASSET MANAGEMENT GROUP

$500m pay cut drives SMSFs to equities

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Original article by Philip Baker
The Australian Financial Review – Page: 21 : 24-Feb-15

Credit Suisse estimates that each 25 basis point reduction in the cash rate slashes the income of self-managed superannuation funds (SMSFs) by $A500m. The firm notes that SMSFs now boast some $A568bn worth of funds under management, with equities accounting for 42 per cent of their investment portfolios. SMSFs are likely to further increase their exposure to equities in order to offset the impact of lower interest rates

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, RESERVE BANK OF AUSTRALIA, STANDARD AND POOR’S ASX 200 INDEX, RIO TINTO LIMITED – ASX RIO, MACQUARIE GROUP LIMITED – ASX MQG, FLIGHT CENTRE TRAVEL GROUP LIMITED – ASX FLT, DULUXGROUP LIMITED – ASX DLX, PHILO CAPITAL ADVISERS PTY LTD, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, TELSTRA CORPORATION LIMITED – ASX TLS, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Big four banks have large cross-sell potential

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 23-Feb-15

A Roy Morgan Consumer Single Source Survey has found that the "share of wallet" of each of Australia’s four major bank has increased over the last decade. The ANZ Bank’s share of wallet rose by 5.2 per cent to 28.8 per cent between January 2004 and December 2014, while the Commonwealth Bank of Australia’s share rose by 4.3 per cent to 34.2 per cent. For accounts/deposits, CBA has the highest share of their customers’ wallet with 60.3 per cent (up 7.1 per cent over the last 10 years), followed by Westpac with 55.3 per cent (up three per cent)

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

Aussie John: end super tax perks to save us

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Original article by Jacob Greber, Samantha Hutchinson
The Australian Financial Review – Page: 1 & 6 : 23-Feb-15

Data from the Department of the Treasury suggests that superannuation tax concessions cost about $A30bn a year. There is a growing push for these tax breaks to be scaled back or abolished, particularly for people with significant savings. Aussie Home Loans founder John Symond suggests that some wealthy people may be exploiting the super system. The Association of Superannuation Funds of Australia has also urged action to address the issue in its pre-Budget submission

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSSIE HOME LOANS LIMITED, THE ASSOCIATION OF SUPERANNUATION FUNDS OF AUSTRALIA LIMITED, GRATTAN INSTITUTE, UNIVERSITY OF CANBERRA. NATIONAL CENTRE FOR SOCIAL AND ECONOMIC MODELLING