MORTGAGE LOANS – AUSTRALIA

Big banks make overtures to home buyers

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Original article by Duncan Hughes
The Australian Financial Review – Page: 48 : 6-Aug-15

Australian lenders are actively targeting the owner-occupier segment of the residential property market, due to new restriction on lending to property investors. Westpac-owned regional banks are offering a range of incentives for owner-occupiers, while some smaller lenders are reducing their loan-to-value ratios in a bid to gain market share from their larger peers.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, ST GEORGE BANK LIMITED, BANK OF MELBOURNE LIMITED, CAPITAL HOMELOANS PTY LTD, BLUEBAY HOME LOANS PTY LTD, LIBERTY FINANCIAL PTY LTD, MORTGAGE AND FINANCE ASSOCIATION OF AUSTRALIA

Westpac’s $1m-a-day IT glitch

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Original article by James Eyers, Clancy Yeates
The Australian Financial Review – Page: 1 & 6 : 28-Jul-15

The Commonwealth and ANZ banks increased their mortgage interest rates for property investors in late July 2015, while cutting fixed interest rates for owner-occupiers. However, Westpac and National Australia Bank currently have a single reference rate for both types of customers, which has forced the latter to increase interest rates for both. Westpac’s IT systems do not allow it to charge different interest rates at present, which is said to be costing it about $A1.15m each day.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, BANK OF AMERICA AUSTRALIA LIMITED, MERRILL LYNCH (AUSTRALIA) PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG, BANK OF MELBOURNE LIMITED, ST GEORGE BANK LIMITED, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD, AUSSIE HOME LOANS LIMITED, DEUTSCHE BANK AG, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Higher bank capital to bite investors, clients

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Original article by James Eyers
The Australian Financial Review – Page: 1 & 10 : 21-Jul-15

The Australian Prudential Regulation Authority has ruled that the nation’s major banks – and Macquarie Group – will need to hold more capital against residential mortgages. The average risk weighting on mortgage loans will rise from around 16 per cent to at least 25 per cent from 1 July 2016. Jarrod Martin of Credit Suisse estimates that the increased capital requirements will result in a modest rise in mortgage interest rates, while Richard Wiles of Morgan Stanley forecasts that dividend payouts will be reduced as a result of the reforms.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CREDIT SUISSE (AUSTRALIA) LIMITED, MORGAN STANLEY AUSTRALIA LIMITED, MACQUARIE GROUP LIMITED – ASX MQG, WESTPAC BANKING CORPORATION – ASX WBC, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, MOODY’S INVESTORS SERVICE INCORPORATED, CUSTOMER OWNED BANKING ASSOCIATION, DELOITTE TOUCHE TOHMATSU LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

ME Bank aims for rapid mortgage growth despite credit rules

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Original article by Clancy Yeates
The Australian Financial Review – Page: 19 : 23-Jun-15

Industry superannuation fund-backed ME Bank hopes to increase annual growth in home loan customers to 20 per cent over the next three years, according to CEO Jamie McPhee. This compares with its current growth rate of about 10 per cent a year. McPhee adds that a $A90m capital investment in ME Bank’s IT systems will increase efficiencies and support its growth ambitions by allowing the group to offer a wider range of home loan products.

CORPORATES
ME BANK, MEMBERS EQUITY BANK PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSSIE HOME LOANS LIMITED, MORTGAGE CHOICE LIMITED – ASX MOC

Banks cut deeper into deposit rates

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Original article by Clancy Yeates
The Australian Financial Review – Page: 20 : 20-May-15

Australian banks have reduced the interest rate on some savings accounts by the full 25 basis point reduction in the cash rate in May 2015. However, some banks have reduced their mortgage interest rates by a lower margin. Michelle Hutchison of Finder.com.au notes that the majority of households do not have a mortgage, while most have savings accounts. Some banks have offered a sweetener to savers by increasing the interest rate on term deposits and accounts that offer bonus interest rates.

CORPORATES
FINDER.COM.AU, RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, MACQUARIE GROUP LIMITED – ASX MQG, AMP LIMITED – ASX AMP, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, BELL POTTER SECURITIES LIMITED, BANK OF WESTERN AUSTRALIA LIMITED, ST GEORGE BANK LIMITED, BANK OF SOUTH AUSTRALIA LIMITED, BANK OF MELBOURNE LIMITED

Interest rate cut has instant impact at property auctions

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Original article by Larry Schlesinger
The Australian Financial Review – Page: 5 : 16-Feb-15

Preliminary data shows that Sydney’s residential property market achieved an auction clearance rate of 77.9 per cent on the weekend of 14-15 February 2015, down from 80.5 per cent for the previous week. Melbourne’s preliminary auction clearance rate rose from 66.3 per cent to 67.4 per cent, while the national clearance rate rose from 67.3 per cent to 70 per cent. Mortgage Choice notes that the interest rate cut in February has resulted in a sharp rise in applications for home loans

CORPORATES
MORTGAGE CHOICE LIMITED – ASX MOC, RESERVE BANK OF AUSTRALIA, CORELOGIC AUSTRALIA PTY LTD, RP DATA LIMITED, AUSTRALIAN PROPERTY MONITORS PTY LTD, JP MORGAN AUSTRALIA LIMITED, McGRATH ESTATE AGENTS, JELLIS CRAIG AND COMPANY

RBA helps BoQ in its new thrust

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Original article by Shaun Drummond
The Australian Financial Review – Page: 21 : 9-Feb-15

The Bank of Queensland (BoQ) will be hoping that its mortgage lending business will be boosted by the 25 basis point reduction in the cash rate on 3 February 2015. The regional bank was quick to announce that it will reduce its fixed and variable home loan rates, as well as its business lending rates. BoQ shares closed at $A13.31 on 6 February, although the consensus share price target of analysts is $A12.71. Most analysts have a "buy" or "hold" recommendation on the stock

CORPORATES
BANK OF QUEENSLAND LIMITED – ASX BOQ, RESERVE BANK OF AUSTRALIA, CLSA AUSTRALIA PTY LTD, INVESTEC BANK (AUSTRALIA) LIMITED, EZCORP INCORPORATED, SUNCORP GROUP LIMITED – ASX SUN, MACQUARIE SECURITIES PTY LTD, JP MORGAN AUSTRALIA LIMITED, BELL POTTER SECURITIES LIMITED, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Bank profits to slow, says Fitch

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Original article by Clancy Yeates
The Australian Financial Review – Page: 15 : 13-Jan-15

Fitch Ratings notes that a decline in bad debts has contributed to the growth of Australian banks’ profits in recent years. However, a new report from Fitch warns that the banks are likely to face a rise in bad debts in 2015, which will result in lower profit growth. Factor such as rising competition in the home loans sector will also adversely affect growth in earnings

CORPORATES
FITCH RATINGS 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, UBS HOLDINGS PTY LTD, JP MORGAN AUSTRALIA LIMITED, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN BUREAU OF STATISTICS

Debt soars on the home front

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Original article by David Uren
The Australian – Page: 2 : 5-Jan-15

A report from the Reserve Bank shows that Australia’s total housing debt now exceeds total household income by 39 per cent. This compared with a differential of just 29 per cent prior to the global financial crisis (GFC). Meanwhile, the interest paid on mortgage loans now accounts for about 7.2 per cent of household income, down from nearly 11 per cent prior to the GFC. The figures also show that total household assets significantly exceed household disposable income

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Majors facing $20bn squeeze

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Original article by Michael Bennet
The Australian – Page: 17 : 8-Dec-14

Among the recommendations made in the financial system review report by David Murray for the Australian Government is that the four main banks should significantly increase their reserve capital holdings. They are also urged to lift the risk weighting on home mortgage loans to a range of 25% to 30%. Analysts calculate that if adopted the new requirements will create an additional cost burden of $A20bn per annum for the sector. Australian Bankers’ Association CEO Steven Munchenberg has vowed to persist with its lobbying effort against the proposals and those of the Australian Prudential Regulation Authority

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN BANKERS’ ASSOCIATION, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BANK FOR INTERNATIONAL SETTLEMENTS. BASEL COMMITTEE ON BANKING SUPERVISION, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, WATERMARK FUNDS MANAGEMENT PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED, CREDIT SUISSE (AUSTRALIA) LIMITED, THE BOSTON CONSULTING GROUP PTY LTD