K: Financial and Insurance Services

Investors shrug off weak outlook, virus threat

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Original article by David Rogers
The Australian – Page: 27 : 20-Feb-20

Pieter Stoltz of UBS notes that 28 per cent of Australia’s large-capitalisation stocks have exceeded their dividend expectations so far in the February reporting season. He says this may be due to factors such as demand for stable income or limited investment opportunities. Stoltz adds that 31 per cent of large companies have upgraded their earnings guidance, while just 19 per cent have downgraded their earnings guidance.

CORPORATES
UBS HOLDINGS PTY LTD

Reserve Bank wary of risks from low rates

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Original article by Patrick Commins
The Australian – Page: 25 : 19-Feb-20

The minutes of the Reserve Bank of Australia’s board meeting for February show that the central bank considered the potential downside risks of further easing monetary policy when it left interest rates on hold. The board also noted that the coronavirus outbreak presents a risk to the economic outlook for both China and Australia in the near-term. Most economists expect an official interest rate cut in April or May, and the futures market has fully priced in a rate cut by October.

CORPORATES
RESERVE BANK OF AUSTRALIA

Home loans lift on property recovery

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Original article by Cliona O’Dowd
The Australian – Page: 20 : 17-Feb-20

A report from Deloitte notes that there was a seven per cent decline in new mortgage settlements in 2019. However, the latest edition of its Australian Mortgage Report shows that lenders and brokers expect a 2-3 per cent increase in mortgage settlements in 2020. Heather Baister of Deloitte says mid-tier lenders such as Macquarie and Citibank could benefit the most from the expected upturn in settlements.

CORPORATES
DELOITTE TOUCHE TOHMATSU LIMITED, MACQUARIE GROUP LIMITED – ASX MQG, CITIBANK PTY LTD

Investors see windfall from iron ore giants

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Original article by Vesna Poljak, William McInnes, Lucas Baird, Elouise Fowler
The Australian Financial Review – Page: 13 & 20 : 17-Feb-20

Futures pricing suggests that the Australian sharemarket will shed about 0.2 per cent when trading resumes on 17 February, after the benchmark S&P/ASX 200 approached a record high in the previous session. The earnings season will be a key focus for investors in the next week, with speculation that BHP and Fortescue Metals Group will increase their dividend payouts due to a strong iron ore price. The impact of the bushfires and the coronavirus on some companies will also be closely scrutinised.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, BHP GROUP LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG

From bad to worse for AMP: $2.5bn loss, $6.3bn outflows, more to come

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Original article by Joyce Moullakis
The Australian – Page: 19 & 23 : 14-Feb-20

Wealth manager AMP has posted a statutory loss of $2.5bn for the 2019 calendar year, while its underlying profit fell by 32 per cent to $464m. A $2.35bn impairment charge in the first half was the major contributor to the big loss. Meanwhile, AMP’s wealth division recorded net cash outflows of $6.3bn for the year, and CEO Francesco De Ferrari says outflows are likely to be high again in 2020. AMP has advised that its customer remediation program is expected to be completed in 2021.

CORPORATES
AMP LIMITED – ASX AMP

Rates to stay low ‘for decades’: RBA

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Original article by Cliona O’Dowd
The Australian – Page: 19 & 29 : 14-Feb-20

Reserve Bank governor Philip Lowe has conceded that the coronavirus outbreak is likely to have a near-term impact on the economy, although he does not expect the outlook for 2020 to be significantly affected. He adds that the Australian economy will benefit from stimulus measures in China when the virus is brought under control. Lowe has also warned that climate change has ‘profound’ economic implications for Australia, while he says official interest rates may remain low for a long time.

CORPORATES
RESERVE BANK OF AUSTRALIA

NAB may delay MLC split after sound result

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Original article by Richard Gluyas
The Australian – Page: 23 : 14-Feb-20

A trading update from National Australia Bank shows that it booked a cash profit of $1.65bn for the first quarter of its financial year. This is one per cent higher than the quarterly average for the second half of fiscal 2019. Revenue increased by less than one per cent for the quarter, while expenses were three per cent higher. Meanwhile, NAB has signalled that the proposed demerger of its MLC wealth management could be postponed due to the challenging business conditions at present.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED

CBA to grab bigger share of business

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Original article by James Frost
The Australian Financial Review – Page: 1 & 20 : 13-Feb-20

The Commonwealth Bank of Australia has posted a 2019-20 interim cash profit of $4.47bn; this is 4.3 per cent lower than previously, although analysts had expected a larger decline. CEO Matt Comyn notes that CBA recorded growth in home lending, business lending and deposits during the half-year, and he has flagged plans to seek an even greater share of the business lending market. Comyn adds that CBA’s investment in digital banking has enabled it to build market share among younger customers; this is also a segment that it will target for further growth.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Westpac lifeline for virus-plagued customers

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Original article by Glenda Korporaal
The Australian – Page: 19 : 12-Feb-20

Westpac has revealed details of its support package for businesses that have been impacted by the coronavirus. Amongst other things, it will allow business loan repayments to be deferred for up to three months, while businesses will also be able to extend their loans for up to three months. Westpac offered similar relief to bushfire victims. Businesses across the economy have been impacted by the virus outbreak, including tourism operators and fresh food exporters.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC

When it comes to compensation payouts, NAB’s $204m leads the pack

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Original article by Richard Gluyas
The Australian – Page: 19 : 12-Feb-20

Data from the Australian Securities & Investments Commission shows that National Australia Bank customers have now received $203.8m in compensation for poor financial advice and services that were not provided. The Commonwealth Bank in turn has paid out $174.2m, ahead of AMP ($167.2m), Westpac ($106.4m), the ANZ Bank ($95.6m) and Macquarie Group ($2.6m).

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