What's New in Banking, Financial Services and Insolvency

Hedge fund managers will need to drastically improve their transparency and communication strategies - or face losing mandates from institutional managers, including the $17 billion ARIA (13 November 2009)

 

Jeremy Cooper's plans for the superannuation industry will shake up a lot more than the funds management business, with corporate Australia directly in the firing line (13 November 2009)

 

Australia's banks might have to go abroad more often to issue debt. That's great news for foreign companies thinking of selling bonds down under. Foreigners have already raised some $12.3 billion this year by selling Aussie-dollar denominated bonds, called kangaroo bonds. That's up 36% from a year ago, according to Dealogic, and accounts for nearly one-fifth of total debt issuance in Australia (13 November 2009)

 

ANZ, Commonwealth Bank and National Australia Bank have each trimmed branch numbers, but the cuts have been modest compared to the widespread closures many made to their networks in the past decade. In total, the number of banks and building societies offering a branch level of service has increased by 52 across Australia, to 6677 in the year to the end of June (13 November 2009)

 

Litigation is often cited as the main beneficiary of any business downturn, but there is another oblique area of financial services which proliferates during a financial crisis, fraud. Insurers even say that without good lines of reporting suspicions, a company will not be considered for fidelity insurance, which covers corporates for internal fraud (12 November 2009)

 

Premiums will vary with circumstances, but in the case of a business whose activities place it at particular risk, they will be higher. Fidelity insurance is developing. There are policies addressing things like identity fraud and fraudulent online transfers and payments (12 November 2009)

 

The NSW government plans to create three new identity offences - trafficking in identity data, possession with intent to commit a crime, and possession of equipment for the purpose of identity theft - in an overhaul of the state's Crimes Act. The new laws will apply to offences committed offline and online (11 November 2009)

The NSW government was scrambling to rewrite its proceeds of crime laws yesterday after the High Court declared a key section unconstitutional and "repugnant to the judicial process".

The case concerned a Crime Commission application under section 10 of the Criminal Assets Recovery Act to freeze the proceeds of various bank and share trading accounts held by the International Finance Trust Company (12 November 2009)

 

The Lonsec review, which awarded only two funds – BT Wholesale Ethical Share Fund and ING Wholesale Sustainable Investment Australian Shares Trust – its coveted ‘highly recommended’ rating, also noted that financial planners faced some challenges in meeting the needs of their clients because of the categorisation of some products and the lack of a uniform approach (13 November 2009)

 

Two former hedge fund managers with the Bear Stearns investment bank have been found not guilty of misleading investors who lost $US1.6 billion ($1.7 billion), the first big test of a US effort to obtain convictions tied to the subprime mortgage crisis and recession

 

ASIC has announced a widely flagged package of reforms. Under the AFS regime, obligations in the Corporations Act will require ratings agencies such as Standard & Poor's and Moody's to manage conflicts of interest, as well as have adequate resources for the scale and complexity of their businesses. Aadequate risk-management systems must be in place including the need for an Australian financial services licence from January 1 (13 November 2009)

Macquarie Private Wealth has appointed Patrick Dieter to the role of head of national wealth protection as it moves to strengthen its insurance business. Macquarie said key focus areas would be life cover, asset and income protection, “and the critical role insurance can play in both estate planning and business succession” (11 November 2009)

 

The performance of transport and utilities stocks will be measured as a group from Monday when a new infrastructure index debuts on the Australian Securities Exchange (ASX) (12 November 2009)

 

Emerging market equities valuations could be headed for a 'bubble' given the amount of liquidity in listed markets and the number of large institutions set to pump funds into the region, one fund manager has warned (12 November 2009)

Put aside mortgage worries and losing one's job - Australians are more concerned about having enough money to retire on than keeping the family home and their work, new research by ASFA shows (12 November 2009)

The number of bank branches has increased for the eighth consecutive year, according to a survey released today by the Australian Prudential Regulation Authority (APRA) (12 November 2009)

 

A Brisbane-based civil engineering and construction firm, Civdec Constructions Pty Ltd, with more than 200 employees has gone into voluntary administration. The company recently handled a project near the international terminal at the Brisbane Airport to cater for A380 aircraft (12 November 2009)

The Companies Auditors and Liquidators Disciplinary Board (CALDB) cancelled the auditor registration of Allan Gregory Walker following an application by ASIC. Mr Walker, of Melbourne, worked as auditor for Mr Duker’s failed Gold Coast property development company, RVP Group Limited. The company went into liquidation last year owing 63 creditors more than $40 million (15 November 2009)

Two unlicensed business advisers have been handed suspended sentences in the Brisbane Magistrates Court. According to ASIC records, Marianna Casella of Gordon Park and Peter Stokes of Mango Hill were each found guilty on July 17 of carrying on an investment advice business without the appropriate licences (09 November 2009)

The Berne Union, has announced the appointment of its new president, Mr Angus Armour, CEO and Managing Director of the Australian Governments Export Finance and Insurance Corporation (EFIC).

The EFIC helps Australian exporters and overseas investors to overcome financial barriers by providing finance, finance guarantees, insurance and bonding facilities (09 November 2009)

Australian banks have imposed tighter terms and conditions on their lending, constraining business credit and presenting significant repercussions for the property and infrastructure sectors, according to the head of domestic markets at the Reserve Bank of Australia, John Broadbent

 

The Federal Court ruling forcing Professional Investment Services (PIS) to pay more than $5 million in Westpoint compensation could have greater consequences for the industry as a whole rather than just for the dealer group. At the time, ASIC alleged PIS was negligent in its provision of advice to investors in relation to Westpoint Group, and breached its Australian financial services licence (09 November 2009)

CORPORATIONS – schemes of arrangement – first court hearing at which orders sought for the holding of meetings of share holders and option holders – in the case of option holders, two classes proposed and therefore two meetings of option holders – one class the holders of in-the-money options and the other class the holders of out-of-the-money options – proposal that consideration to be offered for in-the-money options be based on intrinsic value methodology, whereas consideration to be offered for out-of-the-money options be based on Black-Scholes methodology

CORPORATIONS – application under s 477(2B) of Corporations Act 2001 (Cth) (the Act) for approval nunc pro tunc of two litigation funding agreements between creditor and liquidator – whether liquidator had adequately explained omission to seek approval before agreements were entered into and his delay in remedying that omission – application under s 564 of the Act for order that funding creditor be paid in full out of monies recovered as a result of the funding agreements – other main creditor’s proof of debt had been rejected by liquidator – pending proceeding by that creditor in Supreme Court of New South Wales to establish its entitlement – premature for Court to deal with application under s 564 at this stage.

 

CORPORATIONS – Australian Securities and Investments Commission carrying out investigation as to whether contraventions of the Corporations Act 2001 (Cth) occurred in relation to the operations of a group of companies – director at the centre of the affairs of that group of companies crucial to the investigation – director on a temporary visit to Australia - whether interim orders should be made preventing the director from leaving Australia – s 1323(1) of the Corporations Act 2001 (Cth).

 

Managed investment schemes - winding up of unregistered scheme - liquidator forms opinion that money held by him is not scheme money - application by liquidator to pay money into court -

court's power to give directions under s 601EE(2) - whether liquidator justified in deducting costs of investigation from fund to be paid into court

CONTRACTS – PARTICULAR PARTIES – PRINCIPAL AND AGENT – AUTHORITY OF AGENTS – CONSTRUCTION AND EXTENT OF AUTHORITY – AUTHORITY CREATED BY OTHER MEANS – OTHER CASES – where the parties had agreed as to price – where the agreement was not subject to finance – where the size of the transaction was large relative to previous authorised transactions – where a director of the defendant had authority to negotiate – whether that director had actual authority to conclude this agreement

PRACTICE – Interlocutory injunction – Claim by mortgagor – Whether serious issue to be tried – Whether mortgagee’s power of sale to be restrained – Whether plaintiffs to be required to pay mortgage debt into court.