K: Financial and Insurance Services

Big four banks facing strong competition selling superannuation to their customers

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 4-Sep-14

A Roy Morgan Research Consumer Single Source survey has found that National Australia Bank had an 18.4 per cent share of its customers’ superannuation wallet in the year to July 2014. This compares with 20.5 per cent in the year to July 2010. The Commonwealth Bank now has a 13.2 per cent share of its customers’ super wallet, followed by Westpac with 13 per cent. Meanwhile, industry super funds hold around 25 per cent of bank customers’ super wallet, while AMP holds about six per cent

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

ACCC orange light on Wotif takeover

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Original article by Jamie Freed
The Australian Financial Review – Page: 15 : 5-Sep-14

The Australian Competition & Consumer Commission (ACCC) had been widely tipped to approve Expedia’s acquisition of Wotif.com. However, the competition regulator has expressed concern that the $A703m deal may lead to an increase in commission rates in the accommodation sector. The ACCC has noted that Wotif.com’s low commission rates may have influenced rivals such as Expedia to offer lower rates in Australia than in other markets

CORPORATES
WOTIF.COM HOLDINGS LIMITED – ASX WTF, EXPEDIA INCORPORATED, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, BOOKING.COM BV, BELL POTTER SECURITIES LIMITED, BELL FINANCIAL GROUP LIMITED – ASX BFG, CLIFFORD CHANCE, FLIGHT CENTRE TRAVEL GROUP LIMITED – ASX FLT, HELLOWORLD LIMITED – ASX HLO, STA TRAVEL PTY LTD, PRICELINE.COM, EUROMONITOR, JETSET TRAVELWORLD LIMITED, STELLA TRAVEL SERVICES LIMITED, DRANSFIELD HOTELS AND RESORTS PTY LTD, ACCOMMODATION ASSOCIATION OF AUSTRALIA PTY LTD

Murray review could lift costs

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Original article by Kylar Loussikian
The Australian – Page: 18 : 4-Sep-14

JPMorgan banking analyst Scott Manning warns that wholesale funding costs in the banking sector may rise some $A2.2bn, if recommendations likely to be made by the Australian Government’s new financial system review are adopted. A major issue is potentially more stringent capital requirements to fund home mortgage lending. Interest rate discounts on such loans offered by the main banks have grown to between 1% and 1.4% from 0.2% in 2009

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, JP MORGAN AUSTRALIA LIMITED

Consumer confidence improving

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Original article by Shane Wright
The West Australian – Page: 8 : 4-Sep-14

There has been a one per cent increase in the number of Western Australians who anticipate an improvement in the state’s economy. Likewise, the latest consumer confidence data from the Chamber of Commerce & Industry of Western Australia shows there has been a five per cent fall in the number of people who anticipate that the economy will deteriorate. Meanwhile, state final demand declined by 0.3 per cent in the June 2014 quarter

CORPORATES
CHAMBER OF COMMERCE AND INDUSTRY OF WESTERN AUSTRALIA (INCORPORATED), AMP LIMITED – ASX AMP

Epic $70b dividend haul

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Original article by Vesna Poljak
The Australian Financial Review – Page: 17 & 27 : 4-Sep-14

Credit Suisse estimates that companies in the S&P/ASX 200 announced $A67.8bn worth of dividends in 2013-14, compared with $A61.3bn in the previous financial year. Hasan Tevfik of Credit Suisse notes that some companies are allowing shareholders to receive shares via dividend reinvestment plans rather than be paid in cash. He adds that capital expenditure is also being adversely affected by increased dividend payouts

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, STANDARD AND POOR’S ASX 200 INDEX, TELSTRA CORPORATION LIMITED – ASX TLS, WESFARMERS LIMITED – ASX WES, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, BANK OF AMERICA AUSTRALIA LIMITED, MERRILL LYNCH (AUSTRALIA) PTY LTD

Mining tax deal delays 12pc super until 2025

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 3-Sep-14

On 2 September 2014, the Australian Government finally succeeded in repealing the minerals resource rent tax in the Senate, after striking a deal with the Palmer United Party. The superannuation guarantee will now not be increased again from its current level of 9.5% until mid-2021. It will then reach the 12% target set by the previous federal government in its mining sector tax plans by 2025. Prime Minister Tony Abbott and Treasurer Joe Hockey says the Australian Labor Party could have averted the delay, which will reduce the retirement savings pool by $A128bn over 10 years, by supporting the repeal

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, PALMER UNITED PARTY, AUSTRALIA. DEPT OF FINANCE, THE ASSOCIATION OF SUPERANNUATION FUNDS OF AUSTRALIA LIMITED, INDUSTRY SUPER AUSTRALIA PTY LTD, FINANCIAL SERVICES COUNCIL, RIO TINTO LIMITED – ASX RIO, BUSINESS COUNCIL OF AUSTRALIA

Correction in housing market ‘inevitable’

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Original article by Damon Kitney
The Australian – Page: 21 : 3-Sep-14

Residential real estate prices have risen an average 15% in a year in the Australian state and territory capital markets, while auction clearance rates in late August 2014 are around 70%. Australian Prudential Regulation Authority data also indicate that the main four banks are taking on riskier mortgage loan borrowers. However business leader David Gonski says while an eventual price decline is a certainty in the housing market, the banks are able to manage their lending strategies

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, SCHULTE RESEARCH INTERNATIONAL

Investors back secret BoQ, Suncorp merger talks

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Original article by James Chessell, Sarah Thompson, Ruth Liew, Shaun Drummond
The Australian Financial Review – Page: 1 & 45 : 3-Sep-14

Jan van der Schalk of CLSA believes that there were merits to the proposed merger between Suncorp Group’s banking division and the Bank of Queensland (BoQ). Ausbil Dexia’s Paul Xiradis says any such deal would have been well received by the market, but notes that the groups’ focus on Queensland could be a concern. It has been revealed that Suncorp and BoQ abandoned preliminary merger talks earlier in 2014. Chris Hall of Argo Investments says the resignation of BoQ CEO Stuart Grimshaw means further merger talks are unlikely

CORPORATES
SUNCORP GROUP LIMITED – ASX SUN, BANK OF QUEENSLAND LIMITED – ASX BOQ, CLSA AUSTRALIA PTY LTD, AUSBIL DEXIA LIMITED, ARGO INVESTMENTS LIMITED – ASX ARG, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, UBS HOLDINGS PTY LTD, PROMINA GROUP LIMITED, EZCORP INCORPORATED, VIRGIN MONEY (AUSTRALIA) PTY LTD, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, AUSTRALIAN ASSOCIATED MOTOR INSURERS LIMITED, GIO AUSTRALIA LIMITED, BELL POTTER SECURITIES LIMITED, BELL FINANCIAL GROUP LIMITED – ASX BFG

Satisfaction with financial performance of superannuation highest since GFC

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 1-Sep-14

A Roy Morgan Single Source survey has found that 55.7 per cent of Australians aged 14+ who are members of a superannuation fund were satisfied with the financial performance of their fund in the six months to July 2014. This is 6.9 per cent higher than in July 2013. Roy Morgan’s "Superannuation Satisfaction" report also shows that satisfaction with self-managed super funds was 77.9 per cent in July 2014, followed by industry funds (56.2 per cent) and retail funds (54.2 per cent)

CORPORATES
ROY MORGAN RESEARCH LIMITED, BT INVESTMENT MANAGEMENT LIMITED – ASX BTT

Qantas set to beat Virgin in race to get back in the black

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Original article by Jamie Freed
The Australian Financial Review – Page: 15 & 20 : 2-Sep-14

Qantas and Virgin Australia both posted losses for the 2013-14 financial year, and cost-reduction measures will be a key strategy in their return to profitability. Analysts forecast that Qantas will book a profit of about $A66m for 2014-15, while Virgin is not tipped to be in the black until 2015-16. Meanwhile, Virgin will gain $A336m from the sale of a 35 per cent stake in its frequent flyer program to Affinity Equity Partners

CORPORATES
QANTAS AIRWAYS LIMITED – ASX QAN, VIRGIN AUSTRALIA HOLDINGS LIMITED – ASX VAH, VELOCITY FREQUENT FLYER PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, CLSA AUSTRALIA PTY LTD, CITIGROUP PTY LTD, AFFINITY EQUITY PARTNERS (AUSTRALIA) PTY LTD, MERRILL LYNCH (AUSTRALIA) PTY LTD, AIR NEW ZEALAND LIMITED – ASX AIZ, SINGAPORE AIRLINES LIMITED, ETIHAD AIRWAYS, VIRGIN GROUP LIMITED, TIGER AIRWAYS AUSTRALIA PTY LTD