K: Financial and Insurance Services

Loan deferral scheme a win for economy

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Original article by James Frost
The Australian Financial Review – Page: 19 : 28-Apr-21

More than 468,000 home loan customers in Australia were on deferred repayment plans at the height of the COVID-19 pandemic; this had fallen to 3,170 by the end of March. Likewise, the number of small business borrowers who have deferred their loan repayments has fallen from 235,440 to just 508. Overall, just 0.5 per cent of all loans are still on a ‘repayment holiday’. The loan deferral scheme ended on 31 March, but Australian Banking Association CEO Anna Bligh says the nation’s banks will continue to provide support for distressed households and businesses.

CORPORATES
AUSTRALIAN BANKING ASSOCIATION

Challenge for AMP over pay, fund deal

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Original article by Joyce Moullakis
The Australian – Page: 17 : 26-Apr-21

AMP’s proposal to spin off its private markets division is set to be a key focus of its virtual AGM on 30 April. Brett Le Mesurier of Velocity Trade has downgraded his share price target for AMP in response to the demerger proposal, which followed AMP’s decision to terminate negotiations with Ares Management over a full or partial sale of the business. Meanwhile, two proxy advisers have recommended that shareholders vote in favour of AMP’s remuneration report, while ISS has called for investors to reject it.

CORPORATES
AMP LIMITED – ASX AMP, ARES CAPITAL MANAGEMENT LLC, INSTITUTIONAL SHAREHOLDER SERVICES INCORPORATED

Westpac could halve its network: analysts

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Original article by Richard Gluyas
The Australian – Page: 17 : 22-Apr-21

Brendan Sproules of Citigroup says Westpac could significantly reduce costs by rationalising its network of bank branches and divesting non-core assets. Westpac currently has 958 branches nationwide, but Citigroup’s modelling suggests that there is scope to reduce this to just 518. Westpac’s chief financial officer Michael Rowland will outline a cost-cutting strategy when the bank releases its interim results on 3 May.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, CITIGROUP PTY LTD

Super shines as economy bounces back

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

Data from Chant West shows that the median growth superannuation fund achieved a return of 12.2 per cent in the first nine months of 2020-21. Mano Mohankumar of Chant West says super funds are on track to deliver a double-digit return for the financial year. The median growth fund gained 3.3 per cent in the March quarter and 2.2 per cent so far in April. Hostplus and Sunsuper are among the growth funds that have posted returns of more than 20 per cent so far in 2020-21.

CORPORATES
CHANT WEST FINANCIAL SERVICES PTY LTD, HOST-PLUS, SUNSUPER PTY LTD

RAA tops for general insurance customer satisfaction – marginally ahead of RACT, RAC and Shannons

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Original article by Roy Morgan
Market Research Update – Page: Online : 21-Apr-21

The latest Roy Morgan General Insurance Satisfaction report shows that South Australia-based RAA had the highest general insurance satisfaction rating of 94% in December 2020, an increase of 3% on a year ago. It is followed by Tasmania’s RACT with a customer satisfaction rating of 92% (down 1%), Western Australia’s RAC on 92% (up 5%) and Suncorp Group-owned Shannons on 91% (up 1%). The largest improvement among the leaders for general insurance satisfaction has been by the Suncorp Group’s Bingle, which increased customer satisfaction by 8% points during 2020 to an impressive 88%. The larger general insurance brands which cater to a more diverse range of customers nation-wide have also had a good year, with improvements in customer satisfaction across the board. The big improvers include CommInsure (up 8% points on a year ago), Budget Direct (up 8% points), Allianz (up 5% points), and the larger State-based RACQ in Queensland (up 5% points) and NRMA in NSW (up 3% points). Overall in December 2020 a majority of 82% of Australians are satisfied with their general insurer, up 3% points from the same time a year ago (79%). These latest results are based on in-depth interviews conducted with over 50,000 consumers per annum, including over 35,000 with general insurance.

CORPORATES
ROY MORGAN LIMITED, RAA INSURANCE LIMITED, RACT INSURANCE PTY LTD, RAC INSURANCE PTY LTD, SHANNONS, BINGLE.COM PTY LTD, SUNCORP GROUP LIMITED – ASX SUN, COMMINSURE, BUDGET DIRECT INSURANCE AGENCY PTY LTD, ALLIANZ AUSTRALIA LIMITED, RACQ INSURANCE LIMITED, NRMA INSURANCE LIMITED

Boost for IPO market as Fahour’s Latitude soars on debut

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Original article by Joyce Moullakis
The Australian – Page: 13 & 17 : 21-Apr-21

Shares in non-bank lender Latitude Financial closed at $2.70 on 20 April, four per cent above the stock’s listing price of $2.60. Latitude reached an intra-day high of $2.99, and the stock finished its first day of trading with a market capitalisation of about $2.7bn. Latitude’s successful sharemarket debut after several failed attempts in the past is likely to bolster the IPO market; indeed, a number of rival non-bank lenders are considering a sharemarket float, including SocietyOne and Pepper Australia.

CORPORATES
LATITUDE FINANCIAL SERVICES GROUP LIMITED – ASX LFS, SOCIETYONE AUSTRALIA PTY LTD, PEPPER AUSTRALIA PTY LTD

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