K: Financial and Insurance Services

Economic turmoil to weigh on M&A: Goldman

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Original article by Joyce Moullakis
The Australian – Page: 15 : 14-Nov-22

Mark Sorrell of investment bank Goldman Sachs believes that global merger and acquisition activity will remain subdued until at least 2024. He notes that until recently, there had been widespread expectations that sentiment toward M&A deals would improve in the second half of 2023, but factors such as geopolitical tensions and aggressive interest rate increases have pushed back the likely time-frame for any rebound. Data from Refinitiv shows that there has been a 60 per cent decline in announced deals involving Australian companies in 2022, compared with the same time in 2021.

CORPORATES
THE GOLDMAN SACHS GROUP INCORPORATED, REFINITIV AUSTRALIA PTY LTD

Economists tip supersized Cup day rate rise

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Original article by Ronald Mizen
The Australian Financial Review – Page: 11 : 28-Oct-22

Westpac’s chief economist Bill Evans expects the Reserve Bank of Australia to increase the cash rate by 50 basis points in November, in response to the latest inflation data. Westpac now anticipates that official interest rates will peak at 3.85 per cent, a view shared by the Commonwealth Bank. National Australia Bank and ANZ in turn expect interest rates to peak at 3.6 per cent and 3.1 per cent respectively. Meanwhile, financial markets have priced in a 25 basis point increase in November.

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

Superannuation fund returns go negative in September as markets weaken

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Original article by Rod Myer
The New Daily – Page: Online : 18-Oct-22

Data from SuperRatings shows that the average balanced superannuation fund lost 3.1 per cent in value during September and 5.7 per cent in the year to September. Factors such as rising inflation and interest rates have weighed on super returns in 2022. SuperRatings’ executive director Kirby Rappell anticipates a challenging calendar year for returns in the sector. However, Rappell emphasises that super is a long-term investment, and he notes that balanced funds have returned an average of at least seven per cent over time.

CORPORATES
SUPERRATINGS PTY LTD

APRA warns on bank cyber risks

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Original article by Cliona O’Dowd
The Australian – Page: 13 & 19 : 12-Oct-22

Australian Prudential Regulation Authority chairman Wayne Byres has told a parliamentary committee hearing that a cyber attack on one of the nation’s financial institutions is inevitable. Byres said the sector has invested significantly in protecting their systems from hackers, but it is only a matter of time before a hacker is successful. He added that it is equally important to invest in response capabilities so any breaches are detected quickly and action is taken to limit the damage. S&P Global Ratings recently warned that Australia’s regional banks in particular are vulnerable to data breaches.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, S&P GLOBAL RATINGS

Homeowners rush to refinance their loans

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Original article by Patrick Commins
The Australian – Page: 4 : 5-Oct-22

Data from the Australian Bureau of Statistics shows that a record $19bn worth of home loans were refinanced in August. This is five per cent higher than in July, and 10 per cent higher than a year ago. Owner-occupiers refinanced some $12.8bn worth of home loans, while property investors refinanced $6.1bn worth of loans. The figures also show that new mortgage loan commitments fell 3.4 per cent to $27.4bn in August; there has been a 15 per cent decline in housing loan commitments since the Reserve Bank started increasing the cash rate in May.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS

Super giants split over best interests duty

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Original article by Lucy Dean
The Australian Financial Review – Page: 17 : 5-Oct-22

Industry Super Australia has used its submission to the Quality of Advice Review to criticise the proposal to water down the ‘best interests duty’. The new duty to provide ‘good advice’ would apply to financial services providers such as superannuation funds and banks. ISA contends that the good advice obligation will materially change how financial advice is offered and regulated, and will most likely result in lower quality of advice. The Association of Superannuation Funds of Australia and the Financial Services Council have expressed support for the proposed changes.

CORPORATES
INDUSTRY SUPER AUSTRALIA PTY LTD, THE ASSOCIATION OF SUPERANNUATION FUNDS OF AUSTRALIA LIMITED, FINANCIAL SERVICES COUNCIL

Crisis as bank branches closed

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Original article by Joyce Moullakis
The Australian – Page: 15 : 21-Sep-22

The Finance Sector Union has urged the federal government to hold an inquiry into the impact of bank branch closures on customers and communities. The FSU’s national secretary Julia Angrisano says the union has been particularly concerned about the closure of branches in regional areas. BankWest has advised that it will close 14 branches in NSW, Queensland, Victoria and South Australia, while 29 branches in regional areas in Western Australia will have reduced trading hours. Angrisano has accused BankWest’s parent the Commonwealth Bank of putting "profits before people".

CORPORATES
FINANCE SECTOR UNION, BANKWEST, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Unprofitable firms worth $60b on ASX

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Original article by Vesna Poljak
The Australian Financial Review – Page: 23 : 21-Sep-22

Research from MST Marquee shows that 50 companies in the S&P/ASX 300 are unprofitable, up from 48 prior to the index’s latest quarterly rebalance. Hasan Tevfik of MST notes that investors continue to back unprofitable companies despite their poor performance, noting that these companies have a combined market capitalisation of about $60bn. He says the continued support for profitless companies may be due to investors’ hopes that they will deliver strong returns, as they did in 2009 and the first year of the pandemic.

CORPORATES
MST MARQUEE, STANDARD AND POOR’S ASX 300 INDEX

BHP’s monster dividend to lead a record week of returns

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Original article by Alex Gluyas
The Australian Financial Review – Page: 15 & 33 : 20-Sep-22

Australian investor will receive more than $18bn worth of dividend payments in coming days. Bell Potter strategist Richard Coppleson says BHP’s $12.5bn final dividend will be the biggest payout on record by an Australian-listed company. Rio Tinto’s local shareholders will in turn receive some $1.4bn worth of dividends. Telstra and Santos are among the other companies that will pay their dividends in coming days, while Fortescue Metals Group will pay $3.7bn worth of dividends next week. Listed companies will pay out a total of $33.5bn in dividends during September, and a further $9.6bn in October.

CORPORATES
BHP GROUP LIMITED – ASX BHP,{SPAC}BELL POTTER SECURITIES LIMITED,{SPAC}RIO TINTO LIMITED – ASX RIO,{SPAC}TELSTRA CORPORATION LIMITED – ASX TLS,{SPAC}SANTOS LIMITED – ASX STO,{SPAC}FORTESCUE METALS GROUP LIMITED – ASX FMG

BHP’s monster dividend to lead a record week of returns

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Original article by Alex Gluyas
The Australian Financial Review – Page: 15 & 33 : 20-Sep-22

Australian investor will receive more than $18bn worth of dividend payments in coming days. Bell Potter strategist Richard Coppleson says BHP’s $12.5bn final dividend will be the biggest payout on record by an Australian-listed company. Rio Tinto’s local shareholders will in turn receive some $1.4bn worth of dividends. Telstra and Santos are among the other companies that will pay their dividends in coming days, while Fortescue Metals Group will pay $3.7bn worth of dividends next week. Listed companies will pay out a total of $33.5bn in dividends during September, and a further $9.6bn in October.

CORPORATES
BHP GROUP LIMITED – ASX BHP,{SPAC}BELL POTTER SECURITIES LIMITED,{SPAC}RIO TINTO LIMITED – ASX RIO,{SPAC}TELSTRA CORPORATION LIMITED – ASX TLS,{SPAC}SANTOS LIMITED – ASX STO,{SPAC}FORTESCUE METALS GROUP LIMITED – ASX FMG