SMEs squirrel away cash in crisis: ANZ

Original article by Jared Lynch
The Australian – Page: 13 & 16 : 19-Jul-21

ANZ Bank’s CEO Shayne Elliott says the amount of cash held in bank deposits has surged during the last year, with small businesses and consumers opting to save during the COVID-19 pandemic. He notes that small businesses in particular are opting to save at an "unprecedented rate", adding that this trend could have a slight negative impact on the national economy. However, Elliott says increased savings means that small businesses are in a much stronger position during the current lockdowns compared with 2020.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

NAB eyes Citi’s retail in $2b deal

Original article by James Eyers
The Australian Financial Review – Page: 18 : 14-Jul-21

National Australia Bank has emerged as a potential buyer of Citigroup’s local consumer banking business. NAB has advised that it is holding talks with Citigroup but stresses that a deal may not eventuate. Citigroup has an 11 per cent share of Australia’s credit card market, making it the fifth-biggest player in the sector, while it holds $5.5bn worth of household deposits and some $6.6bn worth of home loans. Australian Competition & Consumer Commission chairman Rod Sims recently indicated that it would closely scrutinise any bid for the Citigroup assets by one of the nation’s major banks.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, CITIGROUP PTY LTD, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Banks brace for lockdown losses

Original article by Joyce Moullakis
The Australian – Page: 13 & 17 : 14-Jul-21

Richard Wiles of Morgan Stanley expects Australia’s major banks to announce combined coronavirus-related loan impairment charges of $700m for the June quarter. Wiles adds that the COVID-19 lockdown in Greater Sydney is likely to prompt the banks to adopt a more conservative approach to making provisions for loan losses. Morgan Stanley also expects loss rates to increase in the second half of 2021 and the first six months of 2022.

CORPORATES
MORGAN STANLEY AUSTRALIA LIMITED

Buyback bonanza for bank investors

Original article by Richard Gluyas
The Australian – Page: 16 : 7-Jun-21

Richard Wiles of Morgan Stanley estimates that the combined surplus capital of Australia’s four major banks is within the range of $19.5bn to $28bn. He says the banks could potentially return about $15bn to investors via share buybacks over the next year, with the Commonwealth Bank tipped to repurchase $5bn worth of shares when its 2021 financial results are announced. Buybacks of this magnitude would reduce the number of bank shares on issue by 3-5 per cent.

CORPORATES
MORGAN STANLEY AUSTRALIA LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

CBA breaks through $100 for first time

Original article by Cliona O’Dowd
The Australian – Page: 13 & 16 : 27-May-21

Shares in the Commonwealth Bank of Australia reached a record intra-day high of $100.20 on 26 May, ending the session at $99.58. CBA’s share price has risen by 12 per cent so far in May, giving it a market capitalisation of $176.7bn. It is now the biggest stock on the local bourse, and the world’s 11th largest bank in terms of market capitalisation. Brett Le Mesurier of Velocity Trade expects CBA shares to trade at around $100 in the near-term, but Dean Fergie of Cyan Investment Management says the stock could rise further.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, VELOCITY TRADE, CYAN INVESTMENT MANAGEMENT PTY LTD

NAB faces legal hit over pay shortfall

Original article by Richard Gluyas
The Australian – Page: 13 & 19 : 26-May-21

National Australia Bank included a pre-tax provision of $128m for wage underpayments in its financial accounts for the second half of 2020. NAB’s remediation program has resulted in current and former part-time employees receiving a combined $55m in compensation to date. However, the Finance Sector Union believes that NAB’s wages underpayment bill may be much higher, given that many of the affected employees work full-time. The union is preparing to take Federal Court action on behalf of NAB’s full-time workers.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, FINANCE SECTOR UNION, FEDERAL COURT OF AUSTRALIA

Overall satisfaction with Big 4 banks is higher than a year ago with CBA & NAB the top two

Original article by Roy Morgan
Market Research Update – Page: Online : 26-May-21

New data from Roy Morgan shows that 80.5% of customers are satisfied with their bank(s) in April 2021, an increase of 1.3% points on a year ago when the COVID-19 pandemic began. The increase was built upon increases in satisfaction for building societies (up 3% points on a year ago), foreign banks (up 2.3% points) and Australia’s ‘Big 4’ banks (up 0.3% points). Satisfaction for the four major banks as a group is 77.1%, up 0.3% points on April 2020, and up 0.2% points on January 2021. The big improver over the last year has been the NAB which has increased its customer satisfaction by 1.9% points to 78.6%, to be just behind the Commonwealth Bank on 78.8% (down 0.2% points). Third is ANZ on 75.0% (up 0.6% points on April 2020), followed by Westpac on 73.5% (down 0.4% points). Among banks as a whole, Beyond Bank scored the highest in April, on 92.7% (up 1.8% points in 12 months). ING was the highest rated foreign bank on 90.6% (up 1.7% points), Newcastle Permanent led the way for building societies on 94.8% (up 3.1% points), while Credit Union Australia was the highest ranked credit union, on 86.9% (up 3.9% points). The findings, taken from Roy Morgan’s Customer Satisfaction report on Consumer Banking in Australia, reflect the successful way the banking sector responded to financial challenges faced by millions of Australians as a result of the 2020 COVID-19 pandemic.

CORPORATES
ROY MORGAN LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, BEYOND BANK AUSTRALIA, ING BANK (AUSTRALIA) LIMITED, NEWCASTLE PERMANENT BUILDING SOCIETY LIMITED, CREDIT UNION AUSTRALIA LIMITED

Earnings jump sees CBA eye buybacks

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

The Commonwealth Bank of Australia has posted unaudited cash earnings from continuing operations of $2.4bn for the March quarter, compared with about $1.3bn for the same period in 2020. CBA’s common equity tier one ratio was 12.7 per cent at the end of the quarter, well above the regulatory requirement of 10.5 per cent. CBA has more than $10bn of excess capital, and CEO Matt Comyn says its capital management plans are likely to be a key focus for investors when its full-year earnings are released in August. Brett Le Mesurier of Velocity Trade expects CBA to return up to $12bn to investors in the 2022 and 2023 fiscal years via a share buyback

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, VELOCITY TRADE LIMITED

Loan deferral scheme a win for economy

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

Westpac could halve its network: analysts

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