BANKS AND BANKING – AUSTRALIA

Brokers lift share of housing pie as bank branches lose business

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Original article by Richard Gluyas
The Australian – Page: 21 : 4-Sep-19

Data from UBS shows that Australia’s major banks account for 79 per cent of existing mortgage loans. However, Jon Mott of UBS says their share of new home loans is likely to keep falling as the trend toward alternatives such as mortgage brokers gathers pace. UBS also notes that the proportion of home loans that are sold via bank branches has fallen from 48 per cent in fiscal 2013 to just 37 per cent. Mott notes that the major banks’ aggressive push to close bank branches in recent years has contributed to the growing use of mortgage brokers.

CORPORATES
UBS HOLDINGS PTY LTD

Macquarie’s $1.6bn capital raise

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

Macquarie Group has advised that its profit for the six months to 30 September will be about 10 per cent higher than the $1.3bn result for the same period in 2018. Macquarie posted a record profit of $2.98bn for the year to 31 March, and Jonathan Mott of UBS has forecast a profit of $3.04bn for fiscal 2020. Meanwhile, Macquarie is seeking to raise $1bn from institutional investors and up to $600m from retail investors via a share purchase plan. Most of the proceeds will be invested in assets such renewable energy, technology and infrastructure.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, UBS HOLDINGS PTY LTD, CADENCE CAPITAL LIMITED – ASX CDT, MOODY’S INVESTORS SERVICE INCORPORATED, CITIGROUP PTY LTD

NPS of banks (and big four banks) continues to improve after Finance Royal Commission

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Original article by Roy Morgan
Market Research Update – Page: Online : 28-Aug-19

New results from Roy Morgan show that the Net Promoter Score levels of Australia’s banks, including the big four banks, have increased significantly since the final report of the Finance Royal Commission was handed down in February 2019. The NPS of the big four banks was 2.1 in July, up 3.7pts since February, and the NPS of banks as a whole was 8.5, up 3.2pts over the last five months. The improvement in NPS scores has returned the measure to a level comparable to that at the time the Finance Royal Commission was established in late 2017. All of the big four banks have improved their NPS since February. The leading big four bank by NPS is the CBA (now on 7.2, up 3.3pts since February). The other three, although improved, were still in negative territory. Teachers Mutual Bank now has the highest NPS of 52.6, up 13.5pts since February. Meanwhile, satisfaction with the big four banks reached 76.1% in July, up by 0.8% points since February, led by increases for the CBA (+1% point), ANZ (+0.9% points) and Westpac (+2.3% points). These are some of the latest findings from Roy Morgan’s ‘Customer Satisfaction report on Consumer Banking in Australia’ and the ‘Financial Institutions Advocacy Report’. These reports are based on in-depth interviews conducted face-to-face with over 50,000 consumers per annum in their homes.

CORPORATES
ROY MORGAN LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, BENDIGO BANK, ING BANK (AUSTRALIA) LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

Savers at risk in bank, credit union data hack

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Original article by Joyce Moullakis
The Australian – Page: 19 : 26-Aug-19

The security of the New Payments Platform is under scrutiny in the wake of revelations that the system has been subject to a second data breach. Cuscal has indicated that only about three per cent of bank and credit union customers who have registered for a PayID have been affected by the breach, which equates to less than 92,000 customers. Westpac customers who use the real-time NPP system were affected by a data breach in June.

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

Report finds ANZ tribal, slow and lazy

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Original article by James Frost
The Australian Financial Review – Page: 12 : 23-Aug-19

ANZ chairman David Gonski has commented on a governance, culture and accountability self-assessment that the bank prepared for the Australian Prudential Regulation Authority. Shortcomings revealed in the document, which Gonski notes was prepared on a confidential basis, prompted APRA to impose a $500 million capital charge on the bank. Gonski says some of these shortcomings include a penchant for seeking short-term fixes and a lack of accountability.

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

Cure for housing fix ‘worse than disease’: UBS

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Original article by Duncan Hughes
The Australian Financial Review – Page: 10 : 23-Aug-19

Investment bank UBS has warned that the Reserve Bank of Australia’s move towards extremely low interest rates risks reflating the residential property ‘bubble’. The ultra-low rates are also putting pressure on the dividend policies and margin levels of the nation’s large banks, while plans by the Australian Prudential Regulation Authority to reduce related-party exposure limits with regard to Tier 1 capital will put pressure on the banks’ capital.

CORPORATES
UBS HOLDINGS PTY LTD, RESERVE BANK OF AUSTRALIA, AUSTRALIA RADIATION LABORATORIES, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Bank charges on deposits a possibility

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Original article by Matthew Cranston
The Australian Financial Review – Page: 10 : 23-Aug-19

Data from the Reserve Bank shows that nearly 10 per cent of the deposits held by Australia’s major banks received no interest prior to the official interest rate cut in July, while a similar proportion of deposits earned interest of less than 50 basis points. Swiss Re’s chief economist Jerome Haegeli says Australian banks could potentially begin charging customers to hold their deposits. Several banks in Europe have already announced such a move, while the Bank of New York Mellon did so in 2011.

CORPORATES
RESERVE BANK OF AUSTRALIA, SWISS REINSURANCE COMPANY, THE BANK OF NEW YORK MELLON CORPORATION, UBS AG, JYSKE BANK, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Fixed rate falling to new lows under 3pc

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Original article by Cliona O’Dowd
The Australian – Page: 21 : 22-Aug-19

Australia’s residential property market has received a boost in the lead-up to the key selling season, with a number of banks reducing their fixed mortgage interest rates to new lows. Greater Bank has slashed its one-year fixed rate to just 2.79 per cent, while some owner-occupier loans offered by St George and the Bank of Melbourne have been reduced to 2.94 per cent. Sally Tindall of RateCity cautions that fixed home loan interest rates may fall even lower, given that the Reserve Bank may further reduce the cash rate.

CORPORATES
GREATER BANK LIMITED, ST GEORGE BANK LIMITED, BANK OF MELBOURNE LIMITED, BANK OF SOUTH AUSTRALIA LIMITED, RATECITY PTY LTD, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, CANSTAR PTY LTD

Where’s the crisis? Westpac skewers talk of quantitative easing

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Original article by Patrick Commins
The Australian Financial Review – Page: 29 : 22-Aug-19

Lyn Cobley, the head of institutional banking at Westpac, says unconventional monetary policy was necessary in response to the global financial crisis. However, she says there is no need for the Reserve Bank to pursue quantitative easing at present, as the Australian economy and the nation’s banking system are "far from crisis". She adds that Westpac’s senior institutional bankers generally agree that further reducing interest rates would have little impact on the borrowing and investment intentions of their clients.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, RESERVE BANK OF AUSTRALIA, EUROPEAN CENTRAL BANK, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Banks should explain credit card fine print

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Original article by Tom McIlroy
The Australian Financial Review – Page: 3 : 20-Aug-19

Research involving almost 400,000 Commonwealth Bank of Australia credit card users suggests that there are benefits to be had by being more transparent with customers. Harvard researchers found that CBA customers who were provided with more transparency about their credit cards spent 9.9 per cent more each month, and were much less likely to cancel their accounts. In announcing the results of their study, authors Ryan W. Buell and MoonSoo Choi called for more research into transparency and customer engagement.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, HARVARD UNIVERSITY