K: Financial and Insurance Services

No rate cut likely as surveys back inaction

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Original article by David Uren
The Australian – Page: 2 : 4-Oct-16

The Reserve Bank of Australia is widely tipped to leave the cash rate unchanged on 4 October 2016. The findings of the Australian Industry Group’s latest manufacturing survey support the case for rates to be left on hold. It shows that business conditions improved in key sectors of the manufacturing industry during September. Other recent surveys has also been upbeat about business conditions.

CORPORATES
RESERVE BANK OF AUSTRALIA, THE AUSTRALIAN INDUSTRY GROUP, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, DUN AND BRADSTREET (AUSTRALIA) PTY LTD

Banks get short shrift from investors

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Original article by Chris Kohler
The Australian – Page: 20 : 4-Oct-16

Australian banks continued to be targeted by short sellers in September 2016. Data from Deutsche Bank shows that the ANZ Bank and Westpac are the most popular among short sellers, with short positions accounting for 1.9 per cent of their issued stock, compared with 1.5 per cent for the Commonwealth Bank and one per cent for National Australia Bank. Meanwhile, Credit Suisse recently suggested that the major banks’ elevated dividend yields may eventually face downward pressure.

CORPORATES
DEUTSCHE BANK AG, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, CREDIT SUISSE (AUSTRALIA) LIMITED, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, BANK OF QUEENSLAND LIMITED – ASX BOQ, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, STANDARD AND POOR’S ASX 200 INDEX

Three-week high for $A on new pact

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Original article by Jens Meyer
The Australian Financial Review – Page: 31 : 30-Sep-16

The Australian dollar rose above $US0.77 in early trading on 29 September 2016, reaching a three-week high. The local currency benefited from OPEC’s decision to limit oil production by between 0.7 per cent and 2.2 per cent to a range of 32.5-33.0 million barrels per day. Other commodities have already been rising lately.

CORPORATES
ORGANISATION OF PETROLEUM EXPORTING COUNTRIES, OANDA AUSTRALIA PTY LTD, RESERVE BANK OF AUSTRALIA, RESERVE BANK OF NEW ZEALAND

OPEC deal sparks energy stocks rally

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Original article by Jessica Sier, Jens Meyer
The Australian Financial Review – Page: 30 : 30-Sep-16

The S&P/ASX 200 index rose one per cent to 5,471.3 points on 29 September 2016. Energy stocks performed strongly following a decision of OPEC members to reduce production in the coming months. The energy sector closed 6.3 per cent higher, with Beach Energy gaining 10 per cent and Santos, Origin and Woodside all climbing more than seven per cent.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, ORGANISATION OF PETROLEUM EXPORTING COUNTRIES, BEACH ENERGY LIMITED – ASX BPT, SANTOS LIMITED – ASX STO, ORIGIN ENERGY LIMITED – ASX ORG, WOODSIDE PETROLEUM LIMITED – ASX WPL, FORTESCUE METALS GROUP LIMITED – ASX FMG, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, LYNAS CORPORATION LIMITED – ASX LYC, SPARK INFRASTRUCTURE GROUP – ASX SKI, MIGME LIMITED – ASX MIG, SOSV, DEUTSCHE BANK AG, UNITED STATES. FEDERAL RESERVE BOARD

NAB pays out $6.5m for poor advice

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Original article by Michael Roddan
The Australian – Page: 23 : 29-Sep-16

National Australia Bank has revealed that it paid $A6.5 million in compensation to customers who received poor financial advice over the past 18 months. NAB’s head of consumer banking and wealth management, Andrew Hagger, said a significant investment had been made in the bank’s complaints resolution system. The Commonwealth Bank has stated that a third of its compensation scheme was completed in June 2016.

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

Shareholders blast CBA CEO’s diversity bonus

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Original article by Patrick Durkin, Matthew Cranston
The Australian Financial Review – Page: 6 : 27-Sep-16

The Commonwealth Bank of Australia has been criticised for adding new targets to its bonus plan. The Australian Shareholders’ Association is concerned that CBA executives will now be rewarded for meeting targets that are unrelated to performance, following the introduction of a 25 per cent target for "diversity, inclusion, sustainability and culture". The bank’s existing 25 per cent bonus for "customer satisfaction" is also controversial. CEO Ian Narev’s remuneration for 2015-16 comprised a base salary of $A8.77 million and performance-linked bonuses of $A3.53 million.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIAN SHAREHOLDERS’ ASSOCIATION, AGL ENERGY LIMITED – ASX AGL, TELSTRA CORPORATION LIMITED – ASX TLS, WOOLWORTHS LIMITED – ASX WOW, INVESTA OFFICE FUND – ASX IOF, ISS – INTERNATIONAL SERVICE SOLUTIONS A/S

Bull market in bonds not over just yet: Citi

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Original article by Chris Kohler
The Australian – Page: 32 : 27-Sep-16

The yield on Australian 10-year government bonds peaked at 2.13 per cent on 21 September 2016, but it has since retreated to below the two per cent level. Citigroup does not believe that the recent spike in bond yields will signal the end of the three-decade bull market, and the firm does not expect the rise in yields to be sustained. Citigroup notes that financial stock are among those that should benefit from higher bond yields, while it says Australian stocks that are vulnerable include real estate investment trusts and utilities.

CORPORATES
CITIGROUP PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, APA GROUP – ASX APA, SYDNEY AIRPORT – ASX SYD, TATTS GROUP LIMITED – ASX TTS, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, HEALTHSCOPE LIMITED – ASX HSO, QANTAS AIRWAYS LIMITED – ASX QAN, RIO TINTO LIMITED – ASX RIO, MACQUARIE GROUP LIMITED – ASX MQG, CALTEX AUSTRALIA LIMITED – ASX CTX, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF JAPAN, EUROPEAN CENTRAL BANK

Investors warned not to expect smooth ride

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Original article by Vanessa Desloires
The Australian Financial Review – Page: 31 : 23-Sep-16

Australian equity strategists are cautious about the near-term outlook for the domestic bourse, with most still expecting the S&P/ASX 200 to be trading at around the 5,500-point level at the end of 2016. Meanwhile, Tony Brennan of Citigroup forecasts that the benchmark index will top 5,750 points by mid-2017. With the US Federal Reserve opting to leave interest rates on hold in September, David Cassidy of UBS says the presidential election could influence the timing of the next interest rate move.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, UNITED STATES. FEDERAL RESERVE BOARD, BANK OF JAPAN

Review may force funds to merge

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Original article by Michael Roddan
The Australian – Page: 23 : 22-Sep-16

Superannuation industry experts suggest that any move to introduce alternatives to the default super fund system could result in more consolidation in the sector. Potential options that have been canvassed by the Productivity Commission in an issues paper include a tender system for default funds. Financial Services Council CEO Sally Loane notes that smaller funds with high fees may be forced to merge if the default super regime is opened to more competition.

CORPORATES
AUSTRALIA. PRODUCTIVITY COMMISSION, FINANCIAL SERVICES COUNCIL, AUSTRALIAN INSTITUTE OF SUPERANNUATION TRUSTEES, RICE WARNER ACTUARIES PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Old lenders losing battle for hearts and minds

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Original article by Michael Bennet
The Australian – Page: 23 : 22-Sep-16

The 2016 global consumer banking survey of professional services firm Ernst & Young shows that just 21 per cent of Australians completely trust that they will receive unbiased advice from their bank. The survey also found that 36 per cent of bank customers have complete trust in their financial institution, compared with 44 per cent of non-bank customers. Meanwhile, 37 per cent of Australian respondents do not consider the products of rival financial providers to be significantly different.

CORPORATES
ERNST AND YOUNG, PRICEWATERHOUSECOOPERS, MACQUARIE GROUP LIMITED – ASX MQG