K: Financial and Insurance Services

Consolidation looms for local lenders

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Original article by Joyce Moullakis
The Australian – Page: 13 & 16 : 12-Apr-21

Global payments and financial services technology group Fiserv processes about one out of every eight payment transactions in Australia. Kees Kwakernaak, the CEO of Fiserv’s Australian arm, expects further consolidation in the local banking sector in coming years. Kwakernaak anticipates mergers at the smaller end of the market in particular. However, he says consolidation in the sector is unlikely to deter non-bank financial services providers from entering the domestic market. Kwakernaak also anticipates greater collaboration among banks, which will be facilitated by initiatives such as the open banking regime.

CORPORATES
FISERV INCORPORATED

Banks grilled on plans for Suncorp

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Original article by Richard Gluyas
The Australian – Page: 13 & 16 : 12-Apr-21

The CEOs of Australia’s four major banks will appear before a parliamentary committee on 15 and 16 April. Shadow assistant treasurer Andrew Leigh says he will seek a commitment from the CEOs that they will not seek to acquire Suncorp’s banking division should it be put on the market. He also wants to them to rule out any further acquisitions in the financial technology sector. The housing market, cyber security, lending standards and the recovery from the COVID-19 pandemic are also likely to be among the issues raised by the economics committee.

CORPORATES
AUSTRALIA. HOUSE OF REPRESENTATIVES STANDING COMMITTEE ON ECONOMICS, AUSTRALIAN LABOR PARTY

Funds fall as super savers hit by Covid

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Original article by Anthony Keane
The Australian – Page: 20 : 9-Apr-21

Data from the Australian Prudential Regulation Authority shows that some of the nation’s largest superannuation funds recorded overall growth in members in 2019-20. However, seven out of 10 super funds had a net loss of members during the financial year, particularly retail funds. The federal government’s early access scheme contributed to the closure of some super accounts, but Association of Superannuation Funds of Australia CEO Martin Fahy says the main factor was the federal government’s policy of consolidating accounts with low balances.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, THE ASSOCIATION OF SUPERANNUATION FUNDS OF AUSTRALIA LIMITED

Options for investors as bourse nears record high

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Original article by David Rogers
The Australian – Page: 20 : 9-Apr-21

Australia’s benchmark S&P/ASX 200 is within striking distance of its record high of 7,197.2 points, set in February 2020. The index reached an intra-day high of 7,012.4 points on 8 April, having gained 60 per cent since falling to a pandemic-induced low in March 2020. The index has gained three per cent in the month to date, compared with an average gain of 2.5 per cent in April. Pieter Stoltz of UBS expects cyclicals and value stocks to outperform the broader sharemarket in the near-term; he also likes stocks with overseas earnings and those with exposure to the housing and mining services sectors.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, UBS HOLDINGS PTY LTD

Westpac insurance sales misleading: ASIC

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 18 : 9-Apr-21

The Australian Securities & Investments Commission is taking legal action against Westpac in the Federal Court. ASIC claims that Westpac mis-sold credit card insurance to customers who did not want it, with more than 380 customers affected in a four-month period between April and July 2015. Westpac has stated that it will work with ASIC constructively through the court process, and that it has not sold credit card insurance since 2019. Credit card insurance came under scrutiny during the Hayne royal commission, and the big banks have stopped selling the product.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, FEDERAL COURT OF AUSTRALIA

‘Ideology gone mad’: Silk slams super veto laws

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Original article by Cliona O’Dowd
The Australian – Page: 17 : 9-Apr-21

AustralianSuper CEO Ian Silk has criticised key elements of the federal government’s proposed superannuation reforms. He is particularly concerned about provisions of the ‘Your Future, Your Super’ bill which allow the government to block an investment by a super fund, even if it is in members’ best financial interests. Silk says that amongst other things, this raises genuine concerns about sovereign risk. David Knox of consultancy firm Mercer in turn warns that subjecting super funds to performance tests will result in lower returns over the longer term, as trustees will be reluctant to invest in some asset classes.

CORPORATES
AUSTRALIANSUPER PTY LTD, MERCER INVESTMENTS PTY LTD

New chief confronts huge task at AMP

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Original article by Joyce Moullakis
The Weekend Australian – Page: 21 & 25 : 3-Apr-21

Analysts are generally positive about the appointment of Alexis George to succeed Francesco De Ferrari as CEO of embattled wealth manager AMP, but note the challenges that she will face. George is currently deputy CEO at the ANZ Bank, and will take up her new role in the September quarter. AMP’s shares have fallen more than 45 per cent since De Ferrari became CEO in December 2018. AMP is still in talks with Ares Management regarding the sale of its private markets division.

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, ARES MANAGEMENT CORPORATION

Third IPO tilt values Latitude at $2.6bn

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Original article by Cliona O’Dowd, Jared Lynch
The Australian – Page: 13 & 19 : 1-Apr-21

Latitude Financial is seeking to raise $200m via an IPO; the non-bank lender and ‘buy now, pay later’ provider is slated to list on the Australian sharemarket in the week beginning 19 April. The IPO will be open to institutional investors, Latitude employees and broking firms. Latitude has made two previous attempts to list on the sharemarket; it shelved an IPO worth $1bn in 2019 due to lack of sufficient interest from investors.

CORPORATES
LATITUDE FINANCIAL GROUP LIMITED

Platinum fears bloody end to mania

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Original article by Richard Henderson
The Australian Financial Review – Page: 27 & 33 : 1-Apr-21

Platinum Asset Management CEO Andrew Clifford warns that the ‘speculative mania’ in growth stocks is not sustainable and will eventually end. He believes that rising yields on long-dated bonds will be the catalyst for the demise of the boom at the speculative end of the sharemarket. Clifford expects investors to re-embrace cyclical stocks as the domestic economy opens up in the COVID-19 pandemic and hard-hit sectors such as travel and leisure recover.

CORPORATES
PLATINUM ASSET MANAGEMENT LIMITED – ASX PTM

Stocks on track for bumper year

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Original article by David Rogers
The Australian – Page: 13 & 19 : 1-Apr-21

Australia’s S&P/ASX 200 Index gained 3.1 per cent during the March quarter, and 15.1 per cent in the first nine months of 2020-21. The local sharemarket may be on track for its best financial-year performance since fiscal 2013, when it gained 17.3 per cent. Lynas Rare Metals, Virgin Money and Zip Co were the top performers during the quarter, each posting gains of at least 40 per cent. The benchmark index had shed 11 per cent in 2019-20, due to the coronavirus-induced slump in the second half.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, LYNAS RARE EARTHS LIMITED – ASX LYC, VIRGIN MONEY UK PLC – ASX VUK, ZIP CO LIMITED – ASX Z1P