K: Financial and Insurance Services

Christmas rally shows no sign of slowdown

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Original article by David Rogers
The Australian – Page: 18 : 21-Dec-17

The latest survey of fund managers by Bank of America Merrill Lynch suggests that the global sharemarket rally may continue into 2018. The December survey shows that the average cash balance of respondents has increased from 4.4 per cent to 4.7 per cent, compared with the average over the last decade of 4.5 per cent. The survey also found that 54 per cent of the 203 respondents expect global economic growth to be above trend over the next year, while inflation is expected to be below trend.

CORPORATES
BANK OF AMERICA CORPORATION, MERRILL LYNCH AND COMPANY INCORPORATED, UNITED STATES. FEDERAL RESERVE BOARD, EUROPEAN CENTRAL BANK, FACEBOOK INCORPORATED, APPLE INCORPORATED, AMAZON.COM INCORPORATED, GOOGLE INCORPORATED, ALPHABET INCORPORATED, BAIDU.COM INCORPORATED, ALIBABA.COM CORPORATION, TENCENT HOLDINGS LIMITED, BELL POTTER SECURITIES LIMITED

Bank inquiry’s massive dragnet

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Original article by Richard Gluyas
The Australian – Page: 13 & 16 : 21-Dec-17

The royal commission into financial services will require banks, insurers and superannuation funds to disclose any instances of misconduct since the start of 2008, and whether they are currently the subject of criminal or civil proceedings. Commissioner Kenneth Hayne has indicated that industry super funds will also be required provide an explanation for any expenditure that not is related to the fund’s administration or the payment of members’ benefits. Meanwhile, Small Business & Family Enterprise Ombudsman Kate Carnell, has reservations about a revised banking code of practice.

CORPORATES
AUSTRALIA. OFFICE OF THE AUSTRALIAN SMALL BUSINESS AND FAMILY ENTERPRISE OMBUDSMAN, INDUSTRY SUPER AUSTRALIA PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, HIGH COURT OF AUSTRALIA

Mortgage brokers added to banking inquiry purview

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Original article by James Frost
The Australian Financial Review – Page: 17 : 20-Dec-17

Commissioner Kenneth Hayne has broadened the banking royal commission’s terms of reference to include the $A344 billion mortgage broking sector. Many had been surprised that the sector was not included in the royal commission’s original terms of reference, given that over 50 per cent of all mortgages are generated via mortgage brokers. Mortgage & Finance Association of Australia CEO Mike Felton contends that the sector’s professional standards are improving, while he notes that it has been the subject of two major reviews in the last 18 months.

CORPORATES
MORTGAGE AND FINANCE ASSOCIATION OF AUSTRALIA, MORTGAGE CHOICE LIMITED – ASX MOC, AUSTRALIA. ATTORNEY-GENERAL’S DEPT, AUSTRALIA. DEPT OF THE TREASURY

No mischief at Westpac, Rat told RBA

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Original article by James Frost
The Australian Financial Review – Page: 26 : 20-Dec-17

Transcripts from the court case concerning the activities of Westpac traders in regard to alleged manipulation of the bank bill swap rate were released by Federal Court Justice Jonathan Beach on 19 December. Closing submissions were presented on 14 December, and a judgment is not expected until 2018. The transcripts were taken from phone calls, including one made by Westpac trader Colin Roden to Reserve Bank of Australia official Matt Boge, in which Roden seeks to assure that himself and fellow traders are not up to any "mischief".

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, FEDERAL COURT OF AUSTRALIA, RESERVE BANK OF AUSTRALIA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN FINANCIAL MARKETS ASSOCIATION INCORPORATED

CBA ignored warnings on systems: regulator

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Original article by James Frost
The Australian Financial Review – Page: 19 : 18-Dec-17

The Commonwealth Bank of Australia has now been accused of 14 contraventions of section 82 of the Anti-Money Laundering and Counter-Terrorism Financing Act. AUSTRAC advised the CBA on 14 December that it is adding six more alleged contraventions to its charges against the bank. AUSTRAC has also stated that the CBA had plenty of opportunities in recent years to improve its counter-terrorism funding and anti-money laundering procedures.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE

Late splurge sparks hopes for 2018 M&A

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 15 & 20 : 18-Dec-17

Data from Dealogic shows that $US86.9 billion worth of mergers and acquisitions had been announced in Australia as at 15 December 2017, which is 3.8 per cent lower than at the same time in 2016. Likewise, the value of announced M&A deals globally has fallen by 4.6 per cent to $US3.5 trillion. However, Nick Sims of Goldman Sachs notes that there has been an upturn in M&A activity in Australia and globally during the December quarter, which is expected to continue in 2018. Meanwhile, the total value of offshore acquisitions made by Australian companies has risen by 75 per cent so far in 2017, to $US26.3 billion.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, GOLDMAN SACHS AUSTRALIA PTY LTD, MACQUARIE CAPITAL PTY LTD, WESTFIELD CORPORATION – ASX WFD, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AWE LIMITED – ASX AWE, INTEGRAL DIAGNOSTICS LIMITED – ASX IDX, SANTOS LIMITED – ASX STO, HARBOUR ENERGY LIMITED, 21ST CENTURY FOX INCORPORATED, WALT DISNEY COMPANY, CVS HEALTH CORPORATION, AETNA INSURANCE COMPANY, HERBERT SMITH FREEHILLS PTY LTD, NUFARM LIMITED – ASX NUF, LINK ADMINISTRATION HOLDINGS LIMITED – ASX LNK

Westpac legal team casts doubt on ASIC evidence

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Original article by James Frost
The Australian Financial Review – Page: 19 : 15-Dec-17

Closing arguments in the Australian Securities & Investment Commission’s bank bill swap rate rigging case against Westpac continue to be heard in the Federal Court. Matthew Darke SC, appearing for Westpac, told the court that it was wrong for ASIC to claim that the evidence it had presented was "gilt edged". He added that many of the comments of Westpac traders that were recorded on tapes and transcripts are open to interpretation. A decision on the case could potentially by delayed until April 2018.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, FEDERAL COURT OF AUSTRALIA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Investors expect US rate hike path to slow

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Original article by Karen Maley
The Australian Financial Review – Page: 24 : 15-Dec-17

Financial markets had generally expected the US Federal Reserve to increase interest rates in December, but Federal Open Market Committee members Charles Evans and Neel Kashkari voted against tightening monetary policy. The latter had also voted against the previous rate increases in March and June, although Evans had been expected to vote in favour of a rate rise. Meanwhile, the Federal Reserve still expects inflation to remain below its target of two per cent until 2019, while it has reiterated its expectations of three rate rises in 2018.

CORPORATES
UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. FEDERAL OPEN MARKET COMMITTEE, FEDERAL RESERVE BANK OF MINNEAPOLIS

Jobs surge supports RBA’s growth forecasts

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Original article by David Rogers
The Australian – Page: 27 : 15-Dec-17

The latest jobs data may strengthen the case for the Reserve Bank of Australia to begin lifting the cash rate in late 2018. Some 62,000 jobs were created in November, and 383,000 in the last year, while the unemployment rate was steady at 5.4 per cent. The Australian Bureau of Statistics data also supports the central bank’s view that economic growth will be above its trend rate in 2018. However, Tom Kennedy of JP Morgan says the RBA is likely to keep interest rates on hold while the unemployment rate remains at its current level, while George Tharenou of UBS does not expect a rate rise until 2019.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, RESERVE BANK OF AUSTRALIA, JP MORGAN AUSTRALIA LIMITED, UBS HOLDINGS PTY LTD, AMP CAPITAL INVESTORS LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

CBA’s terror breaches after lawsuit

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Original article by Nicola Berkovic, Michael Roddan
The Australian – Page: 1 & 2 : 15-Dec-17

Austrac filed an amended statement of claim against the Commonwealth Bank of Australia on 14 December, alleging that there have been further breaches of anti-money laundering and terrorism financing laws since it first launched legal action against the bank. The new allegations include claims that CBA allowed money to be withdrawn from a bank account even though there were suspicions that the account-holder had links to terrorism. CBA has admitted to more than 53,000 of the breaches of money-laundering laws that Austrac had alleged in its original statement of claim.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, FEDERAL COURT OF AUSTRALIA, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. DEPT OF THE TREASURY