Briefs: Bank workers' pay above average, COBA warns on multibrand advisers, ban on SMSF loans mooted

Banking Day staff
  • Estimates published yesterday by the Australian Bureau of Statistics 2014 Survey of Employee Earnings and Hours, covering the last pay period up to 16 May 2014, show that people employed in the finance and insurance services sector were being paid an average of $1573 per week, putting the sector into the 60th percentile (ie, ahead of about 62 per cent of the full-time workforce).

  •  The Customer Owned Banking Association has come out strongly in favour of a new financial adviser register, set to start at the end of next month. "The financial adviser register will disclose the firm that controls the licensee who authorises the adviser," COBA said in a media release yesterday, noting the "significant and continuing consolidation in the funds management industry, and along the product distribution chain." Citing the need to help consumers distinguish genuinely independent advisers from major bank shopfronts, COBA asserted that: "the most effective way to deter such conduct is to ensure that the entity can't hide behind subsidiaries and sub-brands".

  • In a speech to be delivered today at a SMSF Association conference in Melbourne, the Federal Assistant Treasurer, Josh Frydenberg is expected to foreshadow a ban on borrowing by self-managed superannuation funds. In a preview of the speech, which was handed to the AFR yesterday, Frydenberg questioned whether using debt was consistent with the goals of the super system to provide retirement income and limit the risks to taxpayers. Frydenberg said he would consult widely with the industry on the proposed ban, adding that he did not want to pre-empt the government's formal response to the Murray review.

  • Non-bank lender Liberty Financial has "doubled the stakes" by reducing its variable rates on two of its home loan products by up to half a per cent, twice the amount of the RBA's most recent rate cut. According to a report in The Adviser, these changes saw rates for Liberty's "Custom" loans, (similar clients to non-conforming loans) reduced to 4.99 per cent. Liberty's fixed-rate loans were also trimmed, with the one year rate dropping to 4.29 per cent, and its two- and three-year fixed rates moving down to 4.39 per cent.

  • Samsung Electronics is to buy US mobile wallet startup LoopPay, signalling its intention to launch a smartphone payments service to compete with a recent offering from rival Apple. The electronics giant acquired the mobile start-up for an undisclosed sum. The application manages and securely stores all payment cards including credit, debit, loyalty, and gift cards on a mobile device. LoopPay is claimed to work at 90 per cent of merchant locations in the US, more than any other mobile wallet on the market.

  • Research by BankTrack, a "global network of civil society groups", has outed some of the region's largest lenders for financing pulp and paper company Asia Pacific Resources International to clear rainforests on the Indonesian island of Sumatra. BankTrack said APRIL and its affiliates secured US$1.87 billion in financing through three syndicated loans involving at least 22 banks between December 2011 and April 2014. China Development Bank, Bank of China and CITIC were the largest financiers, followed by Santander Bank.

  • A major shift in investment strategy at two of the world's biggest institutional investors is underway in Japan, Reuters reports. Japan Post Holdings president Taizo Nishimuro said the company's banking unit's asset portfolio, which holds US$1.7 trillion in assets - half in low-yielding Japanese Government bonds - is to be shaken up by a newly hired management team. Meanwhile, the country's public pension fund is also being pushed by Prime Minister Shinzo Abe to allocate more of its $1.1 trillion portfolio into riskier but higher-return assets, to boost economic growth.

  • UBS plans to combine its EU businesses into a single "Europa-Bank " with a focus on wealth management, Germany's Handelsblatt newspaper reports, adding the operation will probably be run out of Frankfurt. A preliminary decision on where the unit will be based is to be made next week, the paper reports, describing talks between UBS, Switzerland's biggest bank, and the German financial watchdog Bafin as "advanced".

  • Japan's Mizuho Financial Group is in talks to buy a 60 per cent stake in Philippine lender Bank of Commerce, the latest in a string of investments by Japanese banks in Southeast Asia, the WSJ reports. San Miguel, which has operations ranging from beer brewing to real estate, has tried to sell its stake in the Philippine bank in the past, but so far all deals have stalled over the asking price, estimated at US$500 million. Bank of Commerce is the Philippines' 15th-largest bank by assets with 123 branches across the country.

  • Mahendra Gursahani has been appointed managing director and chief executive officer for Standard Chartered Bank Malaysia. Prior to his appointment, Mahendra was CEO of Standard Chartered Bank in the Philippines.