australian banks

Bank Hybrids: The devil is in the detail.

Lachlan Hughes
Lachlan Hughes Swell Asset Management

We are often surprised that retail investors with whom we speak, are blissfully unaware of the risks involved in owning hybrids. ASIC and the banks have done a great job disclosing the risks, however, the message does not seem to be relayed effectively by financial intermediaries. We hope this note... Show More

australian banks bank hybrids

CBA becoming compelling value as the stock falls out of favour

Clime Asset Management
Clime Asset Management Funds Management & Stock Research

The central argument of our thesis on CBA has been the stock would lose most of its premium to its major bank peers as ANZ and National Australia Bank derisked and improved their profitability by correcting their strategic mistakes (eg. divesting non-core businesses), managing their capital more efficiently and resuming... Show More

Is CBA symptomatic of a perverse cycle?

Clime Asset Management
Clime Asset Management Funds Management & Stock Research

The revelations that the Commonwealth Bank of Australia (CBA) is being taken to court over alleged AUSTRAC reporting and compliance breaches will overshadow its annual result this week. The action is a civil one and a massive penalty is likely. However the monetary penalty is unlikely to affect the CBA... Show More

australian banks ASX:CBA August 2017 Reporting Season

APRA's new capital rules: initial thoughts and implications for the banks

Andrew Martin
Andrew Martin Alphinity Investment Management

APRA have finally come out with their capital rules to fulfil the ‘unquestionably strong’ requirement of the Financial Services Inquiry. The focus is on is the Common Equity Tier 1 ratio requirement (CET1), which is the amount of equity the banks need to hold relative to risk weighted assets (loans).... Show More

capital australian banks apra ASX:ANZ ASX:CBA ASX:NAB ASX:WBC

CommSec Reporting Season Preview

CommSec
CommSec Online Stockbroker

Investors are expecting a lot from companies this season as they wait to see if recent share price growth will be supported by profits. We expect the resources sector to produce solid numbers while the focus on bank forecasts will be key. Show More

Spectrum Insights - The capital adequacy fallacy

Damien Wood
Damien Wood Spectrum Asset Management

The recent collapse of a Spanish bank, two Italian banks, and a missed payment on tier one notes from a German bank reinforced some core beliefs for investing in bank capital. These are:- Show More

May, The Month Of Broker Downgrades

Rudi Filapek-Vandyck

...Meanwhile in the background, hidden from investors' attention which seems focused on bank levies, Trump controversies, central bank intentions and yet another terrorist act in the UK, stockbrokers in Australia have turned May 2017 into a month of downgrades. The first three weeks generated no less than 70 downgrades versus... Show More

Australian banks: little to get excited about but the derating is probably done

Clime Asset Management
Clime Asset Management Funds Management & Stock Research

Major bank equities have derated significantly over the last few weeks with a selloff in response to interim earnings results and the Federal Budget’s new major bank liabilities levy. In this report we present the main themes from the bank reporting season and explain what the new budget levy means... Show More

Australian banks– flaunting history

Damien Wood
Damien Wood Spectrum Asset Management

Risk management, or the lack of it, is usually the key difference between the fortunes of banks when times get tough. History books are full of evidence of what went wrong after a financial calamity. That’s the easy part. The hard part is to foresee the problems. The high level... Show More

Could the governments lending restrictions backfire?

Stuart Jackson
Stuart Jackson Montgomery Investment Management

The law of unintended consequences states that actions – particularly by government – can have adverse effects that are unanticipated or unintended. This law could soon play out as a result of lending restrictions placed on the major banks by the Australian Prudential Regulation Authority (APRA). Show More

australian banks ASX:ANZ ASX:CBA ASX:NAB ASX:WBC

Where are we in the banking cycle?

Livewire Exclusive

Global banks have formed a cornerstone part of PM Capital’s strategy as they’ve taken the #1 ranking in their category in the Morningstar survey over five and eight years. Following the election of Donald Trump, the Nasdaq Global Bank Index is up over 15%. So, has all the easy money... Show More

australian banks ASX:ANZ ASX:CBA ASX:NAB ASX:WBC Global banks

Spectrum Insights - The problem with “bubbles”

Damien Wood
Damien Wood Spectrum Asset Management

“The OECD concludes that Australia has the most over-valued housing market, with prices 52% above their ‘correct” level.“ Similar warnings continue as do the related dangers of investing in those financing the market – banks. The problem is the quote above is from December 2005. The point being, just because... Show More

bonds fixed income bond yields australian banks credit markets

Banks & insurance looking good in 2017

Matthew Haupt
Matthew Haupt Wilson Asset Management

In our view, investors should position themselves for a rising interest rate environment in 2017. Developed market (DM) economies will be leading growth in 2017, taking over from emerging markets (EM) which have previously supported global growth rates. The key to the DM’s recovery will be how the US markets... Show More

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4 key issues for bank shares in 2017

Stuart Jackson
Stuart Jackson Montgomery Investment Management

The outlook for Australia’s banks in 2017 has been made tougher given the rerating of the stocks this last quarter. The expectations built into share prices have clearly lifted in 2017, the big change we expect is a slowing of loan book growth, as we’ve already started seeing in recent... Show More

Finding value in the banking sector

Merlon Capital Partners
Merlon Capital Partners Equity Income Strategies

One sector that is heavily represented in most Australian’s portfolios is the banking sector. In this summary of Merlon's recent teleconference, we overview our valuation metholodgy as applied to Australian banks, where we see value and the outlook for the sector. Merlon invest in undervalued companies based on sustainable free... Show More

Banks Report Card 2016

Hugh Dive
Hugh Dive Atlas Funds Management

Over the last two weeks’ investors have had a wild ride with the markets fretting over the outcome of the US election. In the middle of this, the Australian banks reported their profit results, which gained very little attention. We have no intention of adding to the pile of “expert... Show More

Why are Australian bank ratings under pressure?

UBS Asset Management
UBS Asset Management Fund Manager

Earlier this week, Standard & Poor's (S&P) placed the entire Australian banking system on Negative Outlook. This implies that there is a one-in-three chance 25 Australian Banks' credit ratings may be downgraded within the next 2 years. S&P cited the continuing strength in property prices increases the risk of a... Show More

There’s value emerging in the banks

Wilson Asset Management

Matt Haupt from Wilson Asset Management shares his view on the banks following the recent inquiry into the sector. Haupt says the only new information of any significance was with respect to how banks are setting interest rates. "The bank CEOs have performed very well in my opinion. They got... Show More

australian banks ASX:ANZ ASX:CBA ASX:NAB ASX:WBC big banks

Banks profits – Goldilocks

Damien Wood
Damien Wood Spectrum Asset Management

Some politicians are bleating Australian bank profits are too high. Some financial commentators are fretting saying they are heading too low. At Spectrum we see bank profits from a credit viewpoint as about just right. Often lost in the commentary is perspective. When benchmarking Australian bank profitability against government bond... Show More

Too big to fail - Inflating asset prices

Clime Asset Management
Clime Asset Management Funds Management & Stock Research

Extraordinary monetary stimulus programs, implemented over a sustained period, create real problems for the global financial system. Cracks are starting to show in the form of reduced Defined Benefit pension payouts and an erosion of business and consumer confidence. Investors are essentially forced to take on more risk to generate... Show More