BANKS AND BANKING – AUSTRALIA

Bank ‘power’ to protect $30b profits

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Original article by Shaun Drummond, Patrick Commins, Clancy Yeates, Joyce Moullakis
The Australian Financial Review – Page: 1 & 8 : 26-Oct-15

Some fund managers believe that Australian bank customers rather than shareholders are likely to bear the brunt of complying with new capital requirements. Australian Prudential Regulation Authority chairman Wayne Byres recently suggested that shareholders should expect a slightly lower return as a result of the new requirements. However, all four major banks have now lifted their variable mortgage loan interest rates. Meanwhile, the major banks are poised to post a combined profit in excess of $A30bn for 2014-15.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AURORA FUNDS MANAGEMENT LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, BELL POTTER SECURITIES LIMITED, WATERMARK FUNDS MANAGEMENT PTY LTD, CITIGROUP PTY LTD, CONTANGO ASSET MANAGEMENT LIMITED, ARGO INVESTMENTS LIMITED – ASX ARG, CLYDESDALE BANK PLC, MACQUARIE GROUP LIMITED – ASX MQG, MARTIN CURRIE INVESTMENT MANAGEMENT LIMITED

CBA hike undercuts Westpac

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Original article by Jonathan Shapiro, Phillip Coorey, Clancy Yeates
The Australian Financial Review – Page: 1 & 9 : 23-Oct-15

The Commonwealth Bank will increase its standard variable mortgage interest rates for owner-occupiers and property investors by 15 basis points, to 5.60 per cent and 5.87 per cent respectively. The move has been criticised by federal Treasurer Scott Morrison and Opposition Leader Bill Shorten, and follows Westpac’s recent decision to lift its home loan rates by 20 basis points. The interest rate rises are in response to new capital requirements for the banking sector.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSSIE HOME LOANS LIMITED, RESERVE BANK OF AUSTRALIA

Big four banks lag in home loan customer satisfaction

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 22-Oct-15

A Roy Morgan Single Source survey has found that the overall satisfaction level of home loan customers of Australia’s big four banks was 80 per cent in the six months to September 2015. This compares with 78.2 per cent 12 months ago. The Commonwealth Bank (82 per cent) and Westpac (80.8 per cent) had the highest individual satisfaction ratings among home loan customers of the four major banks. However, ME Bank home loan customers have the highest satisfaction rating (92.8 per cent), closely followed by ING Direct (92.7 per cent). Meanwhile, the Commonwealth Bank increased its lead in overall customer satisfaction (82.5 per cent) among the big four banks.

CORPORATES
ROY MORGAN RESEARCH LIMITED, 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, ME BANK, ING DIRECT, BANK OF SOUTH AUSTRALIA LIMITED, BENDIGO BANK, BANK OF MELBOURNE LIMITED

Bank customers tipped to fix their mortgages

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Original article by Clancy Yeates
The Australian Financial Review – Page: 17 : 21-Oct-15

The fall in the two-year swap rate to just 1.9 per cent has prompted some smaller financial institutions to reduce their fixed mortgage interest rates in recent weeks. ME Bank’s John Caelli says the downturn in the swap rate may be due to renewed speculation about the timing of monetary policy changes in Australia and the US. Jessica Darnbrough of Mortgage Choice says more home loan borrowers may opt for a fixed interest rate in the wake of Westpac’s move to lift its variable rates.

CORPORATES
ME BANK, MORTGAGE CHOICE LIMITED – ASX MOC, WESTPAC BANKING CORPORATION – ASX WBC, BANK OF WESTERN AUSTRALIA LIMITED, NEWCASTLE PERMANENT BUILDING SOCIETY LIMITED, HERITAGE BANK LIMITED – ASX HBS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, RESERVE BANK OF AUSTRALIA, UNITED STATES. FEDERAL RESERVE BOARD

Westpac shares climb after capital raising, rate increase

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Original article by Clancy Yeates
The Australian Financial Review – Page: 1 & 10 : 20-Oct-15

Shares in Westpac closed three per cent higher at $A31.34 on 19 October 2015, after being in a trading halt for almost a week. Clime Investment Management’s John Abernethy suggests that short selling in the wake of a $A3.5bn capital raising may have been the main driver of Westpac’s share price rise, rather than its move to lift mortgage interest rates by 0.2 per cent. Morningstar’s David Ellis says rival banks are likely to increase their own home loan rates.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, CLIME INVESTMENT MANAGEMENT LIMITED – ASX CIW, MORNINGSTAR PTY LTD, WATERMARK FUNDS MANAGEMENT PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA, ALPHINITY INVESTMENT MANAGEMENT PTY LTD

Small lenders likely to follow majors up

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Original article by Shaun Drummond
The Australian Financial Review – Page: 17 : 16-Oct-15

Australia’s other three major banks have not yet increased their home loan interest rates in response to Westpac’s move. Bendigo & Adelaide Bank CEO Mike Hirst has indicated that the regional bank may increase its mortgage rates if the other "big three" do so, while Suncorp Bank, CUA and Firstmac may do so as well. Suncorp reduced its interest rates on some home loans on the same day that Westpac announced its rate increase.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, SUNCORP BANK, SUNCORP GROUP LIMITED – ASX SUN, CREDIT UNION AUSTRALIA LIMITED, FIRSTMAC LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Westpac to stick with dividend lift

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Original article by James Eyers
The Australian Financial Review – Page: 27 & 30 : 15-Oct-15

Westpac’s unaudited preliminary financial accounts for 2014-15 show that it has posted a full-year cash profit of $A7.82bn, which is three per cent higher than previously. Investors will receive a fully franked final dividend of $A0.94 per share, compared with $A0.92 in 2013-14, while Westpac also intends to pay a higher dividend in 2015-16. Westpac shares have been placed in a trading halt until 19 October 2015 due to the group’s $A3.5bn capital raising.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, MORGAN STANLEY AUSTRALIA LIMITED, MACQUARIE GROUP LIMITED – ASX MQG, MOODY’S INVESTORS SERVICE INCORPORATED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Internet banking growth and satisfaction outstrips other channels

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 12-Oct-15

A Roy Morgan Single Source survey has found that 62.2 per cent of Australians aged 14+ used the internet (via website or mobile) to deal with their bank in an average four-week period during the six months to August 2015. This compares with 58.6 per cent in the six months to August 2013. Meanwhile, the proportion of bank customers using branches in an average four-week period has fallen from 35.5 per cent to 32.3 per cent over the last two years. The only area of growth has been mobile banking, which has increased from 26.2 per cent of Australians to 33.6 per cent. The satisfaction level of internet banking is now 90.2 per cent, compared with 88.4 per cent for branches.

CORPORATES
ROY MORGAN RESEARCH LIMITED, SUNCORP BANK, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

ANZ signals push into NSW home lending

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Original article by Jonathan Shapiro, James Eyers
The Australian Financial Review – Page: 1 & 11 : 12-Oct-15

Increasing its share of the home loan market in New South Wales will be a priority for the ANZ Bank under new CEO Shayne Elliott, who will succeed Mike Smith in early 2016. Elliott also says the growing shift to the use of mobile devices for banking represents both a challenge and an opportunity for the banking sector in terms of engaging with customers. Meanwhile, ANZ chairman David Gonski says the group will review its Asian strategy under Elliott.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, WESTPAC BANKING CORPORATION – ASX WBC, ST GEORGE BANK LIMITED, PT PANIN BANK, AMBANK BERHAD, BANK OF TIANJIN COMPANY LIMITED, SHANGHAI RURAL COMMERCIAL BANK, MACQUARIE GROUP LIMITED – ASX MQG, ESANDA FINANCE CORPORATION LIMITED

Big banks grab third of $30b in super fees

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Original article by Jacob Greber
The Australian Financial Review – Page: 4 : 12-Oct-15

Research undertaken by Rainmaker on behalf of Industry Super Australia shows that Australia’s four major banks received about 33 per cent of the $A30bn paid in superannuation fees in 2014-15. Retail super funds and not-for-profit super funds accounted for about 50 per cent and 25 per cent of fees respectively. ISA CEO David Whiteley has expressed concern about the level of transparency in the super industry.

CORPORATES
INDUSTRY SUPER AUSTRALIA PTY LTD, RAINMAKER INFORMATION SERVICES PTY LTD, AMP LIMITED – ASX AMP, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET