after market update

Nicholas Forsyth

A choppy session hit the ASX today however the index fell just -13pts. Not a bad result really given the weakness in overseas markets. The energy sector provided most support with the likes of Santos (STO) up +5.42% to $4.26 and Origin (ORG) up +5.51% to $5.36. Show More

Christopher Joye

In The AFR I argue that even after CBA and NAB hiked rates by 0.15 to 0.17 percentage points in the last two days, they are going to need to raise them again---or not fully pass-on any future RBA cuts. The majors have accumulated $31bn of common equity tier one... Show More

Christopher Joye

In The AFR I argue the Turnbull government has (correctly) paved the way for up to 0.40 percentage points of total out-of-cycle bank home loan rate hikes by both firmly backing the Financial System Inquiry's capital/leverage recommendations, and giving APRA discretion to implement them. One silver lining is that Standard... Show More

Christopher Joye

In The AFR I speak to the hedge funds that shorted the major banks and won. I also present analysis on how the major banks' dividend payout ratios have changed over time and how they compare to key peers around the world (see charts below). "We were meeting with planners... Show More

Marcus Padley

The ASX200 closed up for a second day, rising 35.5 points to 5172. China swooned then rallied, up 2.38%. US futures are up 166. Miners and energy stocks were strong. Show More

Christopher Joye

In The AFR I evaluate one of the greatest long-term threats to conventional banks: the post-GFC revival of "non-banks" and "marketplace" funding, where the latter is also known as "peer-to-peer" (P2P) lending. Ironically, the 1997 Wallis Inquiry into Australia's financial system forecast that banks and their balance-sheets would be largely... Show More

Christopher Joye

In The AFR I present one of my more important analyses of the major banks---a must read for anyone with equities exposure---that tears apart leading analyst forecasts to find an essential Achilles heel at the heart of current valuation models. In short, even the more gloomy analysts like UBS's No.... Show More

Christopher Joye

In The AFR today I address the uncertainty swirling around APRA's finding that the major banks are short 200 basis points of "capital" and speak to a large institutional investor who thinks CBA should take the cheapest equity in history off the table via a $10 billion rights issue. The... Show More

Christopher Joye

In The AFR today I report S&P will likely upgrade the major banks' stand-alone credit profiles from single "A" to "A+" if, as expected, they boost their Common Equity Tier 1 (CET1) capital by more than 120bps. The widely-accepted new-normal for the major banks' core equity is 10% of risk-weighted... Show More

Christopher Joye

APRA's announcement of an increase in the average residential mortgage "risk-weight" applied by Australia's "internal-ratings based" (IRB) banks from 16% currently to "at least" 25% has important consequences for expected returns from bank securities...The substantial increase in equity will inevitably lower the major banks' shareholder returns and close the gap... Show More

Christopher Joye

In The AFR I examine APRA's analysis of the major banks' capital adequacy and conclude that they are likely short about $24 billion of common equity tier one (CET1) capital today, which blows out to $40 billion once you account for the incoming Basel 4 rules. A minority of analysts... Show More

Christopher Joye

In The AFR I argue that the Greek crisis provides for the perfect opportunity to stress-test, or shock, your portfolio...With this in mind, I analyse the relative total return performance of a range of asset-classes during the exceptionally turbulent month of June, including housing, cash, government bonds, ASX hybrids, Aussie... Show More