APRA relaxes buffers as CBA slashes rates

Original article by James Eyers, James Frost
The Australian Financial Review – Page: 19 & 22 : 20-Mar-20

The Australian Prudential Regulation Authority will temporarily ease the "unquestionably strong" equity capital buffers that it imposes on banks. This will allow them to make billions of dollars worth of additional loans to small businesses that are struggling to maintain cashflows during the coronavirus crisis. The Commonwealth Bank responded to APRA’s announcement by cutting its interest rates on small business loans by 100 basis points, while it also cut rates on one-, two- and three-year fixed-rate home loans by 70 basis points.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Open banking rules too tough, say start-ups

Original article by James Eyers
The Australian Financial Review – Page: 13 & 16 : 15-Jan-20

The Australian Competition & Consumer Commission is responsible for the accreditation of financial services providers under the federal government’s ‘open banking’ regime. However, Fintech Australia has criticised the complexity of the process, and notes that it is expected to cost financial technology companies between $50,000 and $100,000 to gain accreditation. Fintech Australia contends that this cost will be prohibitive for many business start-ups. The open banking regime will commence in July, after initially being slated to begin in February.

CORPORATES
FINTECH AUSTRALIA PTY LTD, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

APRA blasts banks over risk failures

Original article by James Frost
The Australian Financial Review – Page: 1 & 2 : 8-Jan-20

The Australian Prudential Regulation Authority is undertaking on-site reviews of the governance, culture, risk and accountability frameworks of the nation’s major banks. APRA chairman Wayne Byres says the initial findings show that changes to these frameworks are needed. Byres has signalled that smaller banks and other financial services providers will also be held accountable. APRA is also APRA is revising the CPS 220 prudential standard.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, ALLIANZ AUSTRALIA LIMITED, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE

Bank stalled as ASIC demanded refunds

Original article by Michael Roddan
The Australian – Page: 13 & 14 : 19-Dec-19

Court documents filed by the Australian Securities & Investments Commission show that National Australia Bank’s internal auditors had raised concerns about charging fees for services that were not provided in April 2016. NAB subsequently made a public admission about the practice, but ASIC executive Louise Macaulay told NAB in November 2017 that its customer remediation program was out of step with rival banks. ASIC subsequently rejected a number of proposed models for compensating NAB customers, while the bank continued to charge ongoing fees until February 2019.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, FEDERAL COURT OF AUSTRALIA, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

NAB to face legal pain over fee rort

Original article by Michael Roddan
The Australian – Page: 13 & 14 : 18-Dec-19

National Australia Bank’s annual general meeting on 18 December will be overshadowed by allegations that it engaged in unconscionable conduct. The Australian Securities & Investments Commission has filed a statement of claim in which it outlines some 8,700 instances in which NAB is alleged to have charged fees for services that were not provided between December 2013 and February 2019. Amongst other things, ASIC also alleges that NAB failed to issue adequate product disclosure statements. NAB has indicated that it has already paid $37.8m in compensation to customers who were affected by the fee-for-no-service scandal.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, WESTPAC BANKING CORPORATION – ASX WBC, AMP LIMITED – ASX AMP

Westpac papers reveal trail of human, IT failure

Original article by Aaron Patrick
The Australian Financial Review – Page: 1 & 4 : 28-Nov-19

Westpac’s confidential disclosures to Austrac show that it breached anti-money laundering and counter-terrorism financing laws some 29 million times. Austrac has accused the major bank of 23 million breaches, and the additional breaches cannot be prosecuted as they fall outside the statute of limitations. The documents also show that international money transfers with seven global banks had not been reported since 2011, due to problems with a computer system upgrade that began in 2010. However, Westpac did not become aware of the problem until May 2017, and it was not reported to Austrac until August 2018.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE

Westpac execs still in the money

Original article by Richard Gluyas, Joe Kelly
The Australian – Page: 1 & 2 : 25-Nov-19

Treasurer Josh Frydenberg has stressed the need for accountability over Westpac’s massive breach of anti-money laundering and counter-terrorism financing laws. He notes that in addition to Austrac’s civil prosecution, there is the potential for Westpac executives and directors to be disqualified under the Banking Executive Accountability Regime. Meanwhile, Westpac chairman Lindsay Maxsted says executives’ short-term bonuses will be frozen; however, their long-term bonuses are not expected to be affected. Other measures taken by Westpac in response to the scandal include shutting down the LitePay international fund transfer network.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Porter flags big Westpac penalty

Original article by James Eyers, Michael Pelly
The Australian Financial Review – Page: 1 & 6 : 22-Nov-19

Attorney-General Christian Porter says he will keep a "watching brief" on the prosecution of Westpac for breaching anti-money laundering laws. He has also warned that Westpac is likely to incur a much bigger financial penalty than the Commonwealth Bank’s record $700m fine for far less serious breaches. Meanwhile, the Australian Prudential Regulation Authority will look into the potential application of the federal government’s Bank Executive Accountability Regime to the Westpac case, while ASIC may investigate whether the bank has breached the Corporations Act.

CORPORATES
AUSTRALIA. ATTORNEY-GENERAL’S DEPT, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, MACQUARIE UNIVERSITY

Westpac must start hunt for a new CEO

Original article by Terry McCrann
Herald Sun – Page: 35 : 21-Nov-19

It is inevitable that Westpac CEO Brian Hartzer will have to step down in the wake of the banking sector’s latest money laundering scandal. This will leave ANZ’s Shayne Elliott as the only CEO of a big four bank who was appointed prior to the Hayne royal commission. The only issue for Westpac’s board is whether to opt for an internal or external successor. Meanwhile, questions need to be asked about the failure of Austrac to ensure that Westpac and the Commonwealth Bank were complying with anti-money laundering laws.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

APRA urges more capital be held against NZ banks

Original article by James Eyers
The Australian Financial Review – Page: 11 & 17 : 16-Oct-19

The Australian Prudential Regulation Authority has warned that the nation’s major banks may need to increase the amount of capital they hold domestically in response to proposed changes to capital requirements in New Zealand. APRA is concerned that the Reserve Bank of NZ’s reforms may prompt banks to shift capital to NZ, where they are the dominant players in the banking sector. The ANZ Bank estimates that APRA’s proposal would reduce its common equity tier 1 capital by about 75 basis points; Westpac in turn says its tier 1 capital would be reduced by about 40 basis points.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, RESERVE BANK OF NEW ZEALAND, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB