Financial Services
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Deferred loan repayments are hitting the banks
Stuart Jackson
September 17, 2020
How badly has the COVID-19 pandemic impacted our banks? A quick look at recently released data on hardship-induced loan deferrals tells some of the answer. And it’s a pretty bleak picture for most of our lenders. continue…
by Stuart Jackson Posted in Companies, Financial Services.
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Why the big banks are underperforming the market
Stuart Jackson
April 23, 2020
If you’re holding shares in an Australian bank – particularly National Australia Bank (ASX:NAB), Westpac (ASX:WBC) or Australia and New Zealand Banking Group (ASX:ANZ) – then you’re likely feeling less wealthy than you were back before Coronavirus was a household word. In just two months, the market has priced in the impact of loan losses by the banks and the potential need for dilutive equity raisings. And the worst may not be over. continue…
by Stuart Jackson Posted in Companies, Financial Services.
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Bank investors – your dividends could soon be put on ice
Stuart Jackson
April 9, 2020
Each day the coronavirus pandemic sets another domino to fall. The latest could be bank dividends. It’s now very likely that our banks will cut – or even postpone – their dividends this year. If they do, it will be a major blow to many retail investors and retirees. continue…
by Stuart Jackson Posted in Companies, Financial Services.
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Why revenue growth should accelerate for Australian Finance Group
Stuart Jackson
March 3, 2020
While achieving revenue growth is proving to be challenging for the banks at present with the impact of ultra-low interest rates and the effects of the Hayne Royal Commission, there are parts of the credit market that are generating very strong growth. continue…
by Stuart Jackson Posted in Companies, Financial Services, Stocks We Like.
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An update on the Australian financial planning landscape
Dean Curnow
February 28, 2020
They say 12 months is a long time in financial markets, but I think 12 months has been an even greater length of time in the financial planning market. Since I previously wrote about the changing advice landscape in Australia, four large financial planning licenses have ceased to exist, with a few more to close doors as the Commonwealth Bank of Australia follow Westpac’s lead in stepping away from the licensee space. continue…
by Dean Curnow Posted in Financial Services.
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Exchanged Traded Products and Income: Same same but different?
Dean Curnow
January 16, 2020
Today, our markets are awash with ETFs, ETMFS, LICs and LITs. The beauty of these exchange traded products is that they offer investors instant diversification in a single trade. But they have some key differences. And it’s worth knowing what they are. continue…
by Dean Curnow Posted in Financial Services.
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What should we expect from the big four banks in 2020?
Stuart Jackson
January 13, 2020
In this week’s video insight Stuart reviews the banks performance in 2019. The banks have endured a turbulent few of years and 2019 was no different, generating a total return of 9.5 per cent for the calendar year, less than half that of the broader market return of 23.8 per cent. Of the major banks the Commonwealth of Australia was the best performer delivering a total return of 16.9 per cent. Looking to 2020, the outlook is improving marginally relative to 2019 but remains challenging. What should we expect? continue…
by Stuart Jackson Posted in Editor's Pick, Financial Services, Video Insights.
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Banking on lower Growth
Stuart Jackson
November 12, 2019
As highlighted in the recent results announcements from Australia and New Zealand Banking Group (ASX:ANZ), Westpac (ASX:WBC) and National Australia Bank (ASX:NAB), the earnings and profits of our major banks are on the slide. It’s further justification for the investment strategy of The Montgomery Fund and The Montgomery [Private] Fund to have an 85 per cent active underweight position in the major banks. continue…
by Stuart Jackson Posted in Companies, Editor's Pick, Financial Services.
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Mortgage arrears and mortgage stress following rate cuts
Andreas Lundberg
November 7, 2019
Back in July last year, I had a look at what was happening with mortgage arrears and mortgage stress in this post. Since then, we have had three rate cuts from RBA and everyone who has floating rate mortgages should be paying quite significantly lower interest now than before the cuts. I therefore thought it would be interesting to see how this has impacted a households capacity to service their mortgage. continue…
by Andreas Lundberg Posted in Financial Services.
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Changing competitive dynamics in mortgage lending
Stuart Jackson
October 28, 2019
In my video blog last week, I discussed why the major banks had not passed on the recent RBA rate cuts in full. This is due to an increasing proportion of each bank’s funding base approaching zero or close to zero interest rates. As most bank customers would know, transaction and traditional savings accounts pay little or no interest at present. This fixes the funding cost of these deposits for the banks irrespective of what the RBA does in terms of lowering its official overnight rate. continue…
by Stuart Jackson Posted in Companies, Financial Services.
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