BANKS AND BANKING – AUSTRALIA

Treasurer’s push to ease SME squeeze

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 9 : 1-Nov-19

The federal government will seek to make it easier for small and medium enterprises to access credit by urging banks to waive responsible lending standards for the sector. Treasurer Josh Frydenberg notes that the distinction between a small business loan and a personal loan is often a grey area, given that small business owners often use their family home as security when taking out a loan. Council of Small Business of Australia CEO Peter Strong says banks often advise small business owners to take out a personal loan instead, as they are cheaper and less complicated.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, COUNCIL OF SMALL BUSINESS ORGANISATIONS OF AUSTRALIA LIMITED, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

ANZ warns of tough going as profit falls

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Original article by Richard Gluyas
The Australian – Page: 17 & 21 : 1-Nov-19

The ANZ Bank’s 2018-19 cash profit was steady at $6.47bn, although its net profit fell seven per cent to $5.95bn. ANZ has warned that trading conditions are likely to remain ‘challenging’ for some time, with CEO Shayne Elliott noting that consumers are opting to save rather than spend their money in the low interest rate environment. He has also rejected suggestions that banks are ‘profiteering’, arguing that ANZ’s return on equity of 10.9 per cent is not unreasonable. ANZ’s final dividend of $0.80 per share will be franked to 70 per cent.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, RESERVE BANK OF AUSTRALIA, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET

Banks face a crisis: former Westpac chief Morgan

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Original article by David Rogers
The Australian – Page: 17 & 28 : 31-Oct-19

Former Westpac CEO David Morgan says the Australian banking sector is experiencing its fourth crisis, due to factors such as slowing economic growth, the misconduct exposed by the Hayne royal commission, and the Banking Executive Accountability Regime. The banking industry veteran, who is currently CEO of Chi-X Australia, cautions against over-regulating the sector, noting that the nation has a world-class banking system by global standards.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, CHI-X AUSTRALIA PTY LTD, INTERNATIONAL MONETARY FUND, AUSTRALIA. DEPT OF THE TREASURY

No option for savers as deposits slashed

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Original article by Michael Roddan
The Australian – Page: 17 & 28 : 29-Oct-19

The Commonwealth Bank’s term deposit interest rates are now well below the official inflation rate. The banking major has cut its term deposit rates by a much higher margin than the 75-basis point reduction in the cash rate so far in 2019. InfoChoice CEO Vadim Taube says savers need to look beyond the four major banks for term deposits that offer above-inflation interest rates. Meanwhile, Liberal MP Tim Wilson says the Reserve Bank should be wary of further easing monetary policy until the impact of the recent series of official interest cuts can be determined.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, INFOCHOICE LIMITED, RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, LIBERAL PARTY OF AUSTRALIA

Westpac lashed in advice ruling

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Original article by Joyce Moullakis
The Australian – Page: 17 & 21 : 29-Oct-19

The Federal Court has upheld the Australian Securities & Investments Commission’s appeal against a December 2018 judgment in favour of Westpac. The case had centred on Westpac’s use of cold-calling to urge its customers to switch their superannuation accounts from other providers to its BT subsidiary, and whether this constituted the provision of general or personal advice. Westpac could face a financial penalty of up to $15m if it decides not to appeal the ruling.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, BT FINANCIAL GROUP PTY LTD, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, FEDERAL COURT OF AUSTRALIA

Goode pushes for RBA rethink

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Original article by Eli Greenblat
The Australian – Page: 17 & 20 : 28-Oct-19

Former ANZ Bank chairman Charles Goode has urged Treasurer Josh Frydenberg to work with the Reserve Bank of Australia to cut its inflation target to as low as one per cent. Goode also believes that the Australian Securities & Investment Commission’s responsible lending rules are restricting lending, and he doubts that people like Frank Lowy and Harry Triguboff would have been able to establish their property businesses if the current responsible lending rules had been around in the post-World War II years. Goode says having a lower inflation target would end the RBA’s obsession with reducing interest rates to meet what he argues are outdated inflation targets.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Westpac refund costs approach $1 billion

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Original article by Lucas Baird, Aleks Vickovich
The Australian Financial Review – Page: 20 : 24-Oct-19

Westpac has advised that its financial accounts for the second half of 2018-19 will include an after-tax provision of $341m for its customer remediation program. This will lift the bank’s remediation costs for the full year to $958m, and $1.9bn on a pre-tax basis since 2017. Westpac has also flagged the potential for significant financial penalties as a result of Austrac’s investigation into its compliance with anti-money laundering laws. Westpac’s financial results for the year to 30 September will be released in early November.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, EVANS AND PARTNERS ASIA FUND – ASX EAF, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Big banks chop 200 branches in cost-cutting drive

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Original article by Cliona O’Dowd
The Australian – Page: 21 : 24-Oct-19

Data from the Australian Prudential Regulation Authority shows that the nation’s four major banks closed 207 branches during 2018-19, and 750 since 2014. Westpac has closed 333 branches in the last five years, including those of its subsidiaries, ahead of ANZ Bank with 190. A Westpac spokesman has defended the closures, noting that less than two per cent of banking transactions are now undertaken in its branches. More than 1,000 ATMs nationwide have also been scrapped in the last year.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, ST GEORGE BANK LIMITED, BANK OF MELBOURNE LIMITED, BANK OF SOUTH AUSTRALIA LIMITED, FINANCE SECTOR UNION

Asset rule has banks with $13bn shortfall

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Original article by Richard Gluyas
The Australian – Page: 21 : 23-Oct-19

Macquarie’s Victor German expects the Reserve Bank of New Zealand to increase the tier-1 capital requirements for Australian banks’ NZ subsidiaries to 16 per cent, as it has previously flagged. German says Westpac, ANZ and National Australia Bank will be hardest hit by the move, estimating that their combined capital shortfall will be around $13bn. However, the Commonwealth Bank’s capital impost is likely to be smaller than Macquarie had previously expected, which could allow it to return up to $3.5bn to shareholders.

CORPORATES
RESERVE BANK OF NEW ZEALAND, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, MACQUARIE GROUP LIMITED – ASX MQG

NAB, ANZ face new climate activist vote

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Original article by Richard Gluyas
The Australian – Page: 19 : 21-Oct-19

Activist group Market Forces recently put forward shareholder resolutions calling on Westpac, the ANZ Bank and National Australia Bank to amend their constitutions in regard to reducing their exposure to fossil-fuel assets. A second activist group, the Australasian Centre for Corporate Responsibility, will table resolutions at the upcoming AGMs of NAB and ANZ, calling on them to withdraw from industry groups whose advocacy stances are at odds with the Paris climate goals. The ACCR states that its resolutions are conditional on shareholders approving the Market Forces resolutions.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MARKET FORCES, AUSTRALASIAN CENTRE FOR CORPORATE RESPONSIBILITY, BHP GROUP LIMITED – ASX BHP