K: Financial and Insurance Services

Cashed-up PE firms prowl ASX for deals

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 13 & 16 : 13-Aug-18

The value of announced mergers and acquisitions involving Australian-listed companies has topped US$39.3bn so far in 2018. Private equity investors have been particularly active; US$11.4bn ($15.6bn) worth of such deals involving both listed and unlisted assets have been announced so far in 2018, which is 47 per cent higher than at the same time in 2017. Experts anticipate that the private equity sector will continue to pursue listed companies, with Tom Story of law firm Allens noting that suitors and their targets have been more willing to agree on price in 2018.

CORPORATES
ALLENS, DEALOGIC (AUSTRALIA) PTY LTD, INVESTA OFFICE FUND – ASX IOF, THE BLACKSTONE GROUP LP, SIRTEX MEDICAL LIMITED – ASX SRX, CDH INVESTMENTS FUND MANAGEMENT COMPANY, BWX LIMITED – ASX BWX, SINO GAS AND ENERGY HOLDINGS LIMITED – ASX SEH, SANTOS LIMITED – ASX STO, HEALTHSCOPE LIMITED – ASX HSO, OAKTREE CAPITAL MANAGEMENT LLC, BILLABONG INTERNATIONAL LIMITED, PACIFIC EQUITY PARTNERS PTY LTD, LIFEHEALTHCARE PTY LTD, CITIGROUP PTY LTD, BGH CAPITAL PTY LTD, BAIN AND COMPANY, I-MED RADIOLOGY, ACCOLADE WINES LIMITED, CHAMP PRIVATE EQUITY PTY LTD, THE CARLYLE GROUP, MANUKA HEALTH, IXOM, PEMBA CAPITAL, DEVICE TECHNOLOGIES AUSTRALIA, GOLDMAN SACHS AUSTRALIA PTY LTD, UBS HOLDINGS PTY LTD, AMCOR LIMITED – ASX AMC, NEW YORK STOCK EXCHANGE

RBA’s Lowe has his share of doubters

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 32 : 10-Aug-18

The Reserve Bank of Australia has not increased the official cash rate since November 2010, but governor Philip Lowe indicated on 8 August that it may not be long before it has to lift rates. An increase in interest rates would mean that the RBA felt that its inflation target of 2.5 per cent might be not be far off being reached, but some economists are not so certain about this, given the experience of economies in other parts of the world.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, MACQUARIE GROUP LIMITED – ASX MQG

NAB chief insists acts not a crime

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Original article by James Frost
The Australian Financial Review – Page: 1 & 8 : 10-Aug-18

The banking royal commission has heard that National Australia Bank is being investigated over more than 100 alleged breaches of the law. The alleged breaches relate to actions by its superannuation and wealth management units, with the investigations being carried out by the Australian Securities & Investments Commission. NAB CEO Andrew Thornburn says that it does not consider that the alleged claims against it amounted to criminal breaches, and he is absolutely certain that they were not criminal acts.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, MLC LIMITED, AMCOR LIMITED – ASX AMC, BHP BILLITON LIMITED – ASX BHP, SOUTH32 LIMITED – ASX S32, CARLTON AND UNITED BREWERIES

Time for companies to splash the buyback cash

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Original article by David Rogers
The Australian – Page: 27 : 10-Aug-18

Berowne Hlavaty of JP Morgan says key indicators suggest that the August reporting season in Australia will be a strong one. The firm’s poll of analysts shows that 33 per cent of stocks are expected to post an earnings surprise on the upside, while only 17 per cent of stocks will surprise on the downside. JP Morgan has identified a number of companies that could potentially announce share buybacks during the reporting season. They include BHP Billiton, Westpac, Woolworths, Insurance Australia Group and Vicinity Centres.

CORPORATES
JP MORGAN AUSTRALIA LIMITED, BHP BILLITON LIMITED – ASX BHP, WESTPAC BANKING CORPORATION – ASX WBC, WOOLWORTHS GROUP LIMITED – ASX WOW, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, VICINITY CENTRES – ASX VCX, BLUESCOPE STEEL LIMITED – ASX BSL, ANSELL LIMITED – ASX ANN, MIRVAC GROUP – ASX MGR, HARVEY NORMAN HOLDINGS LIMITED – ASX HVN, SUNCORP GROUP LIMITED – ASX SUN, PLATINUM ASSET MANAGEMENT LIMITED – ASX PTM, WESFARMERS LIMITED – ASX WES, PERPETUAL LIMITED – ASX PPT, SIMS METAL MANAGEMENT LIMITED – ASX SGM, SEVEN WEST MEDIA LIMITED – ASX SWM, NATIONAL STORAGE REIT – ASX NSR, CHARTER HALL LONG WALE REIT – ASX CLW, LYNAS CORPORATION LIMITED – ASX LYC, IRESS LIMITED – ASX IRE, GROWTHPOINT PROPERTIES AUSTRALIA – ASX GOZ, CHARTER HALL RETAIL REIT – ASX CQR, PERSEUS MINING LIMITED – ASX PRU, CROMWELL PROPERTY GROUP – ASX CMW, PROPERTYLINK GROUP LIMITED – ASX PLG, TASSAL GROUP LIMITED – ASX TGR, CARDNO LIMITED – ASX CDD, MYOB GROUP LIMITED – ASX MYO, MAGELLAN FINANCIAL GROUP LIMITED – ASX MFG, CROWN RESORTS LIMITED – ASX CWN, STANDARD AND POOR’S ASX 200 INDEX, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

NAB placed on criminal charge alert

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Original article by Ben Butler, Michael Roddan
The Australian – Page: 1 & 2 : 9-Aug-18

The "fee for no service" scandal has deepened, with the banking royal commission being told that National Australia Bank had charged more than 4,000 clients some $3m in fees after they had died. Nicole Smith, the chair of NAB’s superannuation trustee, confirmed that it had been charging dead people an adviser fee as recently as June. She said NAB looked into the issue earlier in 2018 after the inquiry heard that the Commonwealth Bank had been collecting fees from deceased customers. The inquiry was also told that NAB’s conduct could potentially incur criminal charges.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Comyn passes first test

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Original article by James Eyers, Jonathan Shapiro
The Australian Financial Review – Page: 1 & 18 : 9-Aug-18

The Commonwealth Bank has posted a 2017-18 cash profit of $9.23bn, which is 4.8 per cent lower than previously. The result was marred by a 9.2 per cent increase in operating expenses in the wake of the bank’s money-laundering scandal and the banking royal commission. CEO Matt Comyn says there will be "substantial progress" on addressing governance issues during 2018-19. Shareholders will receive a 2017-18 full-year dividend of $4.31 per share, which is $0.02 higher than previously.

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, CLIME ASSET MANAGEMENT PTY LTD, UBS HOLDINGS PTY LTD, PERENNIAL VALUE MANAGEMENT LIMITED, ALPHINITY INVESTMENT MANAGEMENT PTY LTD, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MACQUARIE GROUP LIMITED – ASX MQG, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Inflation target here to stay, says Lowe

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Original article by Patrick Commins
The Australian Financial Review – Page: 5 : 9-Aug-18

The Reserve Bank of Australia remains committed to its long-term goal of returning the inflation rate to 2.5 per cent. Central bank governor Philip Lowe says the inflation target will not be reviewed. Lowe has also indicated that achieving the inflation target is not a prerequisite for increasing official interest rates. He added that the statement of monetary policy to be released on 10 August will show that the RBA does not expect the unemployment rate to fall to five per cent before the end of 2020.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, THE ANIKA FOUNDATION

Super carve-out is absolutely ridiculous

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Original article by Anthony Klan
The Australian – Page: 8 : 8-Aug-18

National Party senator John Williams has criticised a loophole in the Superannuation Industry (Supervision) Act which mean that super fund trustees cannot be penalised for breaching it. The statute stipulates that penalties for non-compliance include jail time and financial damages, but these sanctions do not apply to super fund trustees. Williams has described the situation as "ridiculous" and called for urgent action to address the issue.

CORPORATES
NATIONAL PARTY OF AUSTRALIA, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AMP LIMITED – ASX AMP, IOOF HOLDINGS LIMITED – ASX IFL

Slowly but surely, the RBA is turning positive

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Original article by David Rogers
The Australian – Page: 27 : 8-Aug-18

As expected, the Reserve Bank of Australia left interest rates on hold at 1.5 per cent on 7 August, marking two years since its last change in monetary policy. The RBA has maintained its guidance for economic growth in 2018 and 2019, while it expects the unemployment rate to ease to around five per cent over the next several years. The central bank has also indicated that although wages growth is likely to remain low, it should rise over time due to the improvement in the domestic economy.

CORPORATES
RESERVE BANK OF AUSTRALIA, AMP CAPITAL INVESTORS LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

NAB’s fee strategy in spotlight

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Original article by Joanna Mather
The Australian Financial Review – Page: 8 : 7-Aug-18

The banking royal commission has been told that National Australia Bank retained "grandfathered" commissions after merging five separate superannuation funds in 2016. A former NAB executive, Paul Carter, told the inquiry that the bank had been concerned about the impact that abolishing the commissions would have on revenue, as financial planners could potentially have responded to the move by directing clients to other products. The inquiry was also told that NAB failed to inform clients that they could opt out of paying a "plan service fee".

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED, MLC MASTERKEY, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, NULIS