I have to be honest, when the royal commission into the Banking, Superannuation and Financial Services sector was first announced I was skeptical. I thought that the commission would be akin to a “Dog and Pony show” with banking executives grilled for hours about already known scandals and they in... Show More
Since 2000, the Bank Index has been up 12 out of the last 16 years or 75% of the time. In the 12 years that the Bank Average has closed up, the average rise in those 12 years has been MASSIVE - 5.95%, so this is significant. I believe the... Show More
A crowded trade appears when so many investors are positioned similarly that liquidity becomes a problem. Bitcoin is the obvious choice globally, but we wondered where the most crowded trades were on the ASX. To find out, we put the question to Greencape Capital, NAOS, and Market Matters. Show More
The continued success and profitability of Australian banks over the last few decades, as well as recent large capital raisings, means that Australia’s big 4 banks are now valued at over $400 billion by market capitalisation and they account for over 26% of the S&P/ASX 300 index. As a result,... Show More
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
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
Over the last week, ANZ, NAB and Westpac reported their full year 2016 results, while CBA provided a trading update for the September quarter. So I thought it would be a good time to review the key themes to emerge. But first, let’s go back to 21 September, when I... Show More
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
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
Back in May, when ANZ Banking Group (ASX:ANZ) cut its dividend and flagged a lower dividend payout ratio, it was a strong signal that bank investors should not count on an unending stream of rising dividends. As dividend payments – and, more precisely, the dividend payout ratio – is a... Show More
Aside from employing over 200,000 Australians and touching every sector of the Australian economy, the four major banks plus the two regionals comprise 25% of the ASX200 and are the four largest stocks listed on the ASX with a combined market value of A$380 billion. Assessing future prospects for the... Show More
Our big banks are a core holding in most Australian portfolios. But with long-term loan book growth likely to be materially lower in coming years, bank profits – and share prices – could be adversely impacted. There are broadly six variables to focus on when assessing the outlook for the... Show More
Ordinarily, investors are quick to overlook risks in the pursuit of profit. For the past 18 months, the converse has been true in the banking sector. This may be about to change. During the past week, each of the major banks released a profit result or 3rd quarter update. The... Show More
This week on Livewire we had nearly 100 wires posted, while all of them are worth reading, some of them stand out. Satyajit Das sees another crisis brewing, Marcus Padley says the market’s got it wrong on the banks, and Karl Siegling shares some winners from a lower AUD... Here... Show More
Anton Tagliaferro, Investment Director at Investors Mutual, presented a balanced view on the banks in a recent video. While the yield on the banks is attractive, he sees few opportunities to grow earnings. Credit growth, especially business lending, is quite subdued in the current environment, and the banks face some... Show More
Each week we get up to 100 wires submitted by our contributors. While each one is worth reading, there are some that stand out. This week, Hamish Douglass thinks this time really could be different, read everything you need to know about reporting season, and the banks are 'under pressure'.... Show More
After the RBA’s latest cut to official rates, many investors will be tempted to take some of their money out of cash in pursuit of the high dividend yields offered by our banks. But are these yields sustainable as the banks feel the squeeze from margin pressure and increased liquidity... Show More
Aussie market pulled out another positive day despite overall negative sentiment in Asian markets after US Fed inaction and before BOJ stimulus rain. That’s 23 positive days out of 30 trading days since mid-June. Markets are way too calm and volatility indices keep falling….bond yields fall down to 1.87%. US... Show More
The bank sector peaked in March 2015, at the time almost all the banks had outperformed the All Ordinaries accumulation index since the market lows in 2009 and 2011. The recent falls have lost in some cases the outperformance built over five if not 10 years. The rather remarkable charts... Show More
The Australian Banking sector is attractive in part because of its valuation metrics and dividend yield but troubled in other areas where growing margin pressures, rising impairments and increasing capital requirements are making it a difficult investment proposition at present. Although credit growth is tracking at a reasonable rate, margins... Show More