No-win, no-fee prevails in AMP class action face-off

Original article by Michael Pelly
The Australian Financial Review – Page: 8 : 24-May-19

Five law firms filed class actions against AMP in the wake of ‘the fee for no service’ scandal that was unearthed by the banking royal commission. However, NSW Supreme Court Justice Julie Ward ruled on 23 May that only one action, which is a combined effort between Slater & Gordon and Maurice Blackburn, can proceed. Ward said Maurice Blackburn will have to put up $5 million as security for AMP’s expenses, while AMP advised in a statement that it intend to vigorously defend the class action.

CORPORATES
AMP LIMITED – ASX AMP, SUPREME COURT OF NEW SOUTH WALES, SLATER AND GORDON LIMITED – ASX SGH, MAURICE BLACKBURN PTY LTD, QUINN EMANUEL URQUHART AND SULLIVAN LP, SHINE LAWYERS, PHI FINNEY McDONALD PTY LTD

AMP steps up bid to regain lost trust

Original article by Jonathan Shapiro
The Australian Financial Review – Page: 16 : 13-May-19

AMP CEO Francesco De Ferrari has told customers in an open letter that the wealth manager is making significant changes as it seeks to regain their trust. AMP’s reputation took a battering as a result of deficiencies in its operations that were exposed by the Hayne royal commission, with its share price falling from $5.20 to $2.45 during 2018. The letter, which has been reprinted as an advertisement in a number of newspapers, notes that AMP has made fundamental changes to its operations and has bolstered its internal processes.

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

Industry funds to back Murray for AMP chair

Original article by Jonathan Shapiro
The Australian Financial Review – Page: 13 & 18 : 23-Apr-19

It is understood that the Australian Council of Superannuation Investors will conditionally back the appointment of David Murray as AMP chairman at its AGM in May. Proxy advisers have recommended that Murray be appointed. However, there is some controversy about private comments supposedly made by Murray. He is understood to have said that if there is a big vote against his appointment as a result of the controversy regarding the sale of AMP’s life business, the other two directors who were on the board when the decision was made would resign.

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIAN COUNCIL OF SUPERANNUATION INVESTORS INCORPORATED, CGI GLASS LEWIS PTY LTD, INSTITUTIONAL SHAREHOLDER SERVICES INCORPORATED, OWNERSHIP MATTERS PTY LTD

Boutique funds emerge as top performers

Original article by David Rogers
The Australian – Page: 26 : 18-Apr-19

Data from Mercer shows that the median long-only Australian share fund achieved a return of 10.9 per cent in the March 2019 quarter, on the back of a 9.5 per cent gain for the S&P/ASX 300 index. Smallco Broadcap Fund, Collins Opportunistic Value Investing and CBG Australian Equities delivered the best returns for the quarter, while the ECP AM All Cap fund was the top performer in the year to March. BlackRock achieved the best return among long-short funds over both three months and 12 months.

CORPORATES
MERCER INVESTMENTS PTY LTD, SMALLCO BROADCAP FUND, COLLINS OPPORTUNISTIC VALUE INVESTING FUND, CBG AUSTRALIAN EQUITIES FUND, ECP ASSET MANAGEMENT ALL CAP FUND, BLACKROCK INVESTMENT MANAGEMENT (AUSTRALIA) LIMITED

Industry funds to reach $2trn within 10 years

Original article by Joanna Mather
The Australian Financial Review – Page: 3 : 16-Apr-19

KPMG has forecast that Australia’s superannuation industry will boast $5.4trn worth of funds under management by 2029, compared with just $2.7trn at present. The firm’s 2019 Super Insights report also forecasts that industry funds will manage $2trn in 2029, up from $631bn in 2019. Paul Howes of KPMG says union-backed industry funds must ensure that they comply with the ‘sole-purpose test’ as their dominance of the super industry increases.

CORPORATES
KPMG AUSTRALIA PTY LTD, AUSTRALIANSUPER PTY LTD, SUNSUPER PTY LTD, HOST-PLUS, AUSTRALIAN WORKERS’ UNION-FEDERATION OF INDUSTRIAL, MANUFACTURING AND ENGINEERING EMPLOYEES, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA. DEPT OF THE TREASURY, MLC LIMITED, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, BT FINANCIAL GROUP PTY LTD, WESTPAC BANKING CORPORATION – ASX WBC, BHP GROUP LIMITED – ASX BHP

CBA’s Colonial buy cost shareholders $54b

Original article by Jonathan Shapiro
The Australian Financial Review – Page: 17 : 9-Apr-19

The Commonwealth Bank of Australia paid $11 billion for Colonial in 2000, but fund manager Merlon Capital Partners contends that the purchase wasted over $50 billion in shareholder capital. Merlon argues that the CBA’s purchase of Colonial did not create value for its stockholders, and that it demonstrates the need for shareholders to have a greater say about large acquisitions. Merlon has previously been critical of AMP’s 2018 decision to sell its life insurance business.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, COLONIAL LIMITED, MERLON CAPITAL PARTNERS PTY LTD, AMP LIMITED – ASX AMP

CBA shelves wealth sale on Hayne hit

Original article by Richard Gluyas
The Australian – Page: 21 & 25 : 15-Mar-19

The Commonwealth Bank has advised that the divestment of its wealth and mortgage broking assets has been put on hold to allow it to focus on implementing the Hayne royal commission’s recommendations and its customer remediation program. National Australia Bank also recently indicated that it will postpone its proposed demerger of wealth manager MLC due to the fallout from the royal commission.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, COLONIAL FIRST STATE GROUP LIMITED, COLONIAL FIRST STATE GLOBAL ASSET MANAGEMENT, FINANCIAL WISDOM LIMITED, COUNT FINANCIAL LIMITED, AUSSIE HOME LOANS LIMITED, MLC LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, IOOF HOLDINGS LIMITED – ASX IFL, MITSUBISHI UFJ TRUST AND BANKING INCORPORATION, WESTPAC BANKING CORPORATION – ASX WBC

AMP and Clayton Utz roll over for ASIC

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

An AMP spokesperson has confirmed that it has withdrawn its claim of legal and professional privilege over documents sought by the Australian Securities & Investments Commission regarding the fee-for-no-service scandal. Clayton Utz had been involved in the claim; the documents in question included notes taken by Clayton Utz in interviews with AMP employees over the scandal. ASIC deputy commissioner Daniel Crennan attacked AMP for trying to delay its investigation, although he said it was pleased that the sought documents had now been released.

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, CLAYTON UTZ

S&P cuts AMP rating, more action to come

Original article by James Frost
The Australian Financial Review – Page: 17 : 5-Mar-19

Ratings agency Standard & Poor’s has downgraded AMP’s credit rating from ‘A’ to ‘A-‘ in the wake of the wealth manager’s decision to sell its life insurance arm. S&P has flagged the potential for a further downgrade once the sale is completed, noting that the deal will affect AMP’s creditworthiness. Rival ratings agency Moody’s Investor Services recently downgraded the credit rating of AMP Life after it posted a 2018 operating loss of $176m.

CORPORATES
AMP LIMITED – ASX AMP, AMP LIFE LIMITED, STANDARD AND POOR’S FINANCIAL SERVICES LLC, MOODY’S INVESTORS SERVICE INCORPORATED, AMP BANK LIMITED, RESOLUTION LIFE GROUP LIMITED, CREDIT SUISSE (AUSTRALIA) LIMITED

Prosecutors told to push the envelope

Original article by James Frost, Liz Main
The Australian Financial Review – Page: 10 : 6-Feb-19

The fees-for-no-service scandal has cost Australia’s four major banks and wealth manager AMP more than $2bn to date. They may also face prosecution under section 1041G of the Corporations Act, after the final report of the financial services royal commission recommended that ASIC should expand its existing probe into potential breaches of this section to include more companies. This is in addition to a recommendation by commissioner Kenneth Hayne that 24 cases of misconduct should be referred for potential civil or criminal action.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AMP LIMITED – ASX AMP, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, IOOF HOLDINGS LIMITED – ASX IFL, SUNCORP GROUP LIMITED – ASX SUN, COLONIAL FIRST STATE GROUP LIMITED