K: Financial and Insurance Services

Major banks reduce legal powers over SME customers

roymorgansocial Leave a comment

Original article by James Eyers
The Australian Financial Review – Page: 16 : 1-May-17

All four of Australia’s major banks have made changes to the terms of their loans to small businesses. The changes, which were recommended by small business ombudsman Kate Carnell, relate to "non-monetary default" clauses in loan contracts. The changes will apply to loans of up to $A3 million, although in the case of Westpac and the ANZ, they will only apply to new loans or when an existing loan is being renewed or modified. The Commonwealth Bank and National Australia Bank will apply the changes to both new and existing loans.

CORPORATES
AUSTRALIA. OFFICE OF THE AUSTRALIAN SMALL BUSINESS AND FAMILY ENTERPRISE OMBUDSMAN, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN BANKERS’ ASSOCIATION

Banks set for earnings boost from rate hikes

roymorgansocial Leave a comment

Original article by James Frost, Jonathan Shapiro
The Australian Financial Review – Page: 13 & 16 : 1-May-17

The ANZ Bank, Westpac and National Australia Bank will release their 2016-17 interim results in early May 2017, while the Commonwealth Bank will release a trading update for the third quarter of its financial year. The "big four" banks are forecast to post a combined interim cash profit of around $A16bn. Earnings are expected to have been bolstered by the banks’ recent moves to lift their interest rates for investor and interest-only home loans. Citigroup forecasts that the rate rises will boost earnings per share by up to two per cent in 2017.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, CITIGROUP PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSBIL INVESTMENT MANAGEMENT LIMITED, UBS HOLDINGS PTY LTD, STANDARD CHARTERED BANK MALAYSIA BERHAD, STANDARD CHARTERED BANK PLC, DNR CAPITAL PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG

US, Britain soak up cash

roymorgansocial Leave a comment

Original article by David Uren
The Australian – Page: 28 : 27-Apr-17

Data shows that Australian foreign investment doubled in the 10 years to 2015, to $A534bn, and offshore investment now accounts for 32.4 per cent of GDP. The US tops the list of overseas investment destinations, at $A105bn, ahead of the UK ($A85bn). However, Andrew Parker of PwC notes that Asia accounts for only 10.9 per cent of Australia’s total foreign investment. A survey by PwC has found that Australia’s dividend imputation system is generally not regarded as a deterrent to investing in Asia.

CORPORATES
PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, COMMITTEE FOR ECONOMIC DEVELOPMENT OF AUSTRALIA, STANDARD AND POOR’S ASX 200 INDEX, ASSOCIATION OF SOUTH-EAST ASIAN NATIONS

Inflation will decide the rate debate

roymorgansocial Leave a comment

Original article by Philip Baker
The Australian Financial Review – Page: 30 : 26-Apr-17

Investors will be awaiting the release of Australia’s CPI data for the March 2017 quarter, which may influence the timing of any change to monetary policy. The headline inflation rate is widely tipped to have risen by 2.2 per cent year-on-year, which would be the first time that inflation has been within the Reserve Bank’s target range of 2-3 per cent since the September 2014 quarter. However, the underlying inflation rate for the year to March is expected to be around 1.8 per cent.

CORPORATES
RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, WOOLWORTHS LIMITED – ASX WOW

Report pans banks’ reform resistance

roymorgansocial Leave a comment

Original article by Richard Gluyas
The Australian – Page: 21 : 26-Apr-17

The ANZ Bank is the only major Australian bank to have supported the key recommendations of the House of Representatives economics committee’s first report on increasing competition and governance in the industry. The recommendations included measures to make bank executives more accountable for the misconduct of employees. The Australian Labor Party still maintains the need for a royal commission into the banking sector.

CORPORATES
AUSTRALIA. HOUSE OF REPRESENTATIVES STANDING COMMITTEE ON ECONOMICS, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIAN LABOR PARTY, AUSTRALIAN BANKERS’ ASSOCIATION, LIBERAL PARTY OF AUSTRALIA

Active fundies struggle as passive index huggers deliver

roymorgansocial Leave a comment

Original article by James Frost
The Australian Financial Review – Page: 1 & 8 : 26-Apr-17

Data from S&P Dow Jones Indices shows that more than 75 per cent of Australia’s actively-managed large-cap equity funds failed to match the performance of their benchmark index in 2016. Independent Asset Management and Hyperion Asset Management are among the active fund managers to have underperformed in recent years, as investors have increasingly embraced passively-managed index funds.

CORPORATES
S&P DOW JONES INDICES LLP, INDEPENDENT ASSET MANAGEMENT PTY LTD, HYPERION ASSET MANAGEMENT LIMITED, HYPERION AUSTRALIAN GROWTH COMPANIES FUND, MERCER INVESTMENTS PTY LTD, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, STANDARD AND POOR’S ASX 200 ACCUMULATION INDEX, STANDARD AND POOR’S ASX 300 ACCUMULATION INDEX

Banks may have to sell rivals’ products

roymorgansocial Leave a comment

Original article by James Eyers
The Australian Financial Review – Page: 3 : 24-Apr-17

Australian Securities & Investments Commission chairman Greg Medcraft says the regulator may use soon-to-be acquired powers to restrict the scope of banks to cross-sell products. He was speaking at a financial technology forum in London. He said it is also possible that banks could be compelled to sell products offered by rivals under its "product intervention" powers.

CORPORATES
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, INTERNATIONAL MONETARY FUND, AUSTRALIAN BRITISH CHAMBER OF COMMERCE

Multiple SMSF strategy may prove illegal

roymorgansocial Leave a comment

Original article by Sally Patten
The Australian Financial Review – Page: 5 : 24-Apr-17

Changes to superannuation tax rules from 1 July 2017 may prompt some investors who already have one self-managed super fund (SMSF) to set up a second one. However, the Australian Taxation Office has indicated that it will keeping a close eye what it perceives as any attempt to reduce tax by setting up a second SMSF. Fines, penalties and even disqualification are possible remedies available to the ATO.

CORPORATES
AUSTRALIAN TAXATION OFFICE, SMSF ASSOCIATION, HLB MANN JUDD

Brokers slam ‘radical’ home loan reforms

roymorgansocial Leave a comment

Original article by Duncan Hughes, James Frost
The Australian Financial Review – Page: 15 & 19 : 20-Apr-17

The recommendations of a review of remuneration in Australia’s retail banking industry have been criticised by mortgage brokers. The recommendations include banning volume-based incentives and so-called soft dollar payments. Mortgage Choice and Australian Finance Group are among the mortgage broking firms that have questioned the recommendations of the review, which was undertaken by Stephen Sedgwick on behalf of the Australian Bankers’ Association.

CORPORATES
MORTGAGE CHOICE LIMITED – ASX MOC, AUSTRALIAN FINANCE GROUP LIMITED – ASX AFG, MONEYQUEST, AUSTRALIAN BANKERS’ ASSOCIATION, AUSTRALIAN PUBLIC SERVICE COMMISSION, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Jobs to go at NAB as banks face cost squeeze

roymorgansocial Leave a comment

Original article by Richard Gluyas
The Australian – Page: 19 : 20-Apr-17

Australian banks are continuing to downsize their workforces amid rising costs, falling net interest margins and new capital requirements. The ANZ Bank has advised that it shed 35 IT jobs in early 2017, while National Australia Bank recently told staff that it intends to cut about 500 jobs. However, NAB will create 400 new jobs, with some displaced staff likely to be redeployed. There was a 2.4 per cent reduction in full-time staff in Australia’s banking industry in 2015-16.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY