K: Financial and Insurance Services

US election may hurt dealmakers

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Original article by Glenda Korporaal
The Australian – Page: 15 : 6-Nov-24

Mergers and acquisitions lawyer Sandy Mak from Corrs Chambers Westgarth says it is "hard to predict" just how the outcome of the presidential election will affect US investment in Australia and other countries. US companies are one of the largest foreign investors in Australia, and Mak says they could put plans to invest in Australia on hold if the election results in geopolitical uncertainty; she notes that corporate America has historically been wary of investing offshore in times of volatility and uncertainty.

CORPORATES
CORRS CHAMBERS WESTGARTH

Investors call time on ASX’s record rally

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Original article by Alex Gluyas
The Australian Financial Review – Page: 25 : 23-Oct-24

The Australian sharemarket has retreated from the record high of 8,384.5 points that it reached last week. The pullback follows a gain of 20 per cent over the last year, although Wall Street has risen by 39 per cent over the same period. Meanwhile, the benchmark S&P/ASX 200’s price-earnings ratio has risen from 14.4 times to 18.3 times over the last year. There is growing speculation that the market’s rally cannot be sustained, given that earnings growth is tipped to be flat in 2024 and just five per cent in 2025.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX

Risk of mortgage stress eases for third straight month

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Original article by Roy Morgan
Market Research Update – Page: Online : 24-Oct-24

New research from Roy Morgan shows that 1,724,000 mortgage holders (28.3%) were ‘At Risk’ of ‘mortgage stress’ in September 2024. This represents a decrease of 0.2% points on the June figures, prior to the Stage 3 tax cuts that increased household income for millions of Australians. However, modelling by Roy Morgan shows that the number of mortgages ‘At Risk’ will increase to new record highs in November and December if the RBA raises interest rates by 25 basis points in both months. The number of Australians ‘At Risk’ of mortgage stress has increased by 917,000 since May 2022, when the RBA began a cycle of interest rate increases. Meanwhile, the number of mortgage holders considered to be ‘Extremely At Risk’ of mortgage stress is now numbered at 1,082,000 (18.3% of mortgage holders), which is significantly above the long-term average over the last 10 years of 14.6%. These are the latest findings from Roy Morgan’s Single Source Survey, based on in-depth interviews conducted with over 60,000 Australians each year, including over 10,000 owner-occupied mortgage-holders.

CORPORATES
ROY MORGAN LIMITED

Industry calls for more changes than just axing debit card fees

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Original article by David Ross, David Rogers
The Australian – Page: 13 & 19 : 16-Oct-24

The Reserve Bank of Australia has confirmed that it will investigate the regulation of the payments system, in the wake of the federal government’s proposal to ban debit card surcharges by 2026. Amongst other things, the RBA has indicated that its review will examine the costs that merchants incur when they accept card payments, and whether its surcharging framework is still ‘fit for purpose’. The Australian Banking Association’s CEO Anna Bligh argues that abolishing debit card surcharges would be a "win for consumers", although some observers contend that broader reform is needed.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN BANKING ASSOCIATION

Fears ASX may have peaked after killer quarter

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Original article by Joshua Peach, Joanne Tran
The Australian Financial Review – Page: 13 & 21 : 1-Oct-24

The benchmark S&P/ASX 200 gained 6.5 per cent during the September quarter, with Zip Co, Orora and Guzman y Gomez among the best-performing stocks during the period. September was also a strong month for the local bourse, which reached new record highs in seven separate trading sessions and delivered the best return for the month since 2013. However, Jason Steed from JP Morgan is amongst those who believe that the Australian sharemarket may struggle to post further gains, noting that the earnings outlook is relatively weak.

CORPORATES
STANDARD AND POOR’S ASX 200 INDEX, ZIP CO LIMITED – ASX ZIP, ORORA LIMITED – ASX ORA, GUZMAN Y GOMEZ LIMITED – ASX GYG, JP MORGAN AUSTRALIA LIMITED

CBA trials AI to replace local call centre staff

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Original article by Paul Smith
The Australian Financial Review – Page: 16 : 17-Sep-24

The Commonwealth Bank is trialling a ChatGPT-style platform called Hey CommBank, with a view to use it to potentially replace thousands of local call centre staff. CBA chief data and analytics officer Andrew McMullan says he expects there will come a time when its customers have become so used to using ChatGPT-style services that it will become the way that they interact with the bank, while Finance Sector Union assistant secretary Nicole McPherson has labelled the CBA’s plans to replace local call centre staff with its Hey CommBank platform as "disrespectful and tricky".

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

ANZ’s Elliott dismisses conspiracy theory

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Original article by Lucas Baird, Jonathan Shapiro
The Australian Financial Review – Page: 15 : 13-Sep-24

ANZ CEO Shayne Elliott has sought to downplay the impact of the scandal that has engulfed its trading room during a town hall meeting with the bank’s staff on Wednesday. The trading room is currently the subject of three separate investigations – the reporting of inflated data to a government agency, an investigation into its bond trading and allegations of serious workplace misconduct – with Elliott telling staff the ANZ’s view was that the three issues were unrelated. However, he said the media has speculated otherwise, and has "spun them into this big conspiracy theory".

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Weak conditions to put a dampener on dividends

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Original article by Glenda Korporaal
The Australian – Page: 13 & 16 : 11-Sep-24

Australian-listed companies paid out more than $80bn worth of dividends in 2023-24, which is five per cent higher than the previous financial year. However, Ryan Felsman from CommSec warns that shareholders should expect lower dividend payouts in 2023-24. He says that energy, consumer discretionary and real estate stocks in particular are likely to deliver lower dividends in the current fiscal year. A report from CommSec has concluded that despite some headwinds, returns on Australian shares are still attractive compared with alternatives such as bank deposits, bonds and international equities.

CORPORATES
COMMONWEALTH SECURITIES LIMITED

The $5.1 billion problem costing one in four workers

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Original article by Millie Muroi
The Age – Page: Online : 28-Aug-24

The Super Members Council estimates that about 2.8 million workers were not paid their full superannuation entitlement in 2021-22, which equates to one in four workers. The underpayment totalled $5.1bn, which is around $1,800 per worker. The council says this could reduce affected employees’ retirement payouts by around $30,000; it also notes that unpaid super could force many people to delay their retirement. The council contends the federal government’s legislation requiring employers to align super contributions with their pay period rather than each quarter will help reduce underpayments; however, Labor has yet to legislate the change.

CORPORATES
SUPER MEMBERS COUNCIL

The share of mortgage holders At Risk of mortgage stress fell in July after the Stage 3 tax cuts

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Original article by Roy Morgan
Market Research Update – Page: Online : 28-Aug-24

New research from Roy Morgan shows that 1,604,000 mortgage holders (29.8%) were ‘At Risk’ of ‘mortgage stress’ in the three months to July 2024. This represents a decrease of 0.5% points on the June figures after the introduction of the Stage 3 tax cuts in July increased household income for millions of Australians, including many mortgage holders. The level of mortgage holders ‘At Risk’ of mortgage stress is set to fall further over the next few months. However, a reduction in mortgage stress will not happen if the Reserve Bank board decides to raise interest rates at its next meeting in September. The number of Australians ‘At Risk’ of mortgage stress has increased by 797,000 since May 2022, when the RBA began a cycle of interest rate increases. Meanwhile, the number of mortgage holders considered to be ‘Extremely At Risk’ of mortgage stress is now numbered at 982,000 (18.9% of mortgage holders), which is significantly above the long-term average over the last 10 years of 14.5%. These are the latest findings from Roy Morgan’s Single Source Survey, based on in-depth interviews conducted with over 60,000 Australians each year, including over 10,000 owner-occupied mortgage-holders.

CORPORATES
ROY MORGAN LIMITED