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WBC - WESTPAC BANKING CORPORATION


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What I should have said picking the REAL bottom - that's of course what I meant - the bottom before the upswing - that's the tricky part,. There can be many false starts, as you said. During the GFC just when you thought a stock had reached it's REAL bottom, there was another, and yet another. Those who picked the REAL bottom did very nicely

 

Has WBC reached it's REAL bottom? I'd like to think so, but I think there is a bit more pain to come, albeit not as dramatic as the recent Banking Commission bloodletting. The Banks are all scheduled to report HY results in coming week - should be positive all round, but thanks to the RC some of their "profitable" past practices may need to be shutdown and that will, no doubt, impact on future profits. Analysts downgrades are expected, and it's also expected the banks won't be able to muscle their way into the half trillion dollars of savings held in the MySuper system. Then there's fines (probably won't fit the crime) and reimbursements to victims - although WBC has already made some - and what happens if there is a significant Australian house price correction Time will tell - today all's well :)

 

WBC's SP is up, along with the other big Banks this morning.

 

Short sales Fri 27th Apr, 2018 2,790,092 3,423,361,803 0.08% 11,713,111 23.82%

https://www.shortman.com.au/stock?q=wbc

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The UBS call was a bit of a shot across the bows but as it turns out Westpac have been ahead of the game and have already implemented many of the required changes.

 

Chris Joye covers these and other aspects in the AFR.

 

ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“Contrary to Tony Abbott's suggestion the regulators should be sacked in response to the royal commission, APRA has generally been doing an excellent job. The housing boom kicked- off in 2013 and APRA has been hounding banks on loan serviceability standards since late 2014, when it introduced a raft of rules and established a prudential mortgage lending guide.

 

After this column sensationally revealed that NAB and others were not complying with one new rule, APRA conducted a comprehensive shadow-shopping exercise in early 2015 to test bank-by-bank standards. This naturally identified deficiencies, which APRA's outstanding boss Wayne Byers publicly excoriated the banks on in May 2015. In early 2016 APRA repeated the exercise with much more favourable results.

 

It has also introduced tough limits on lending to investors, interest-only borrowers and high loan-to-value ratio customers, with approvals to these cohorts all plummeting. Concurrently, APRA has forced the big banks to deleverage and raise their equity capital ratios to "unquestionably strong" levels that rank them among the lowest risk banks in the world. The royal commission's recommendations will only reinforce this process.ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ÂÂ

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UBS's shot across the bow - was it because they are SHORT

 

Chris Joyce's rebuttal - was it because he is LONG, as per his disclaimer in that article - "The author is a portfolio manager with Coolabah Capital Investments, which invests in fixed-income securities including those discussed by this column".

 

Who knows :)

 

 

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Quite possibly - its also possible to overthink these things.

 

Regulators only see good guys/bad guys, financiers only see profit and we all want our money which makes us all conflicted by our personal interests.

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  • 3 weeks later...
Watching the Royal CommissionÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s lawyer burying WestpacÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s head honcho on business loans. Truly pitiful!
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Westpac have finally got their act together and now have a woman answering the Commissioners questions. SheÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s doing a very good job and clearly knows what she is there for. WBC share price has turned up into the green. ANZ has had a women answering for them also and she came across as very a professional and competent person. Pauline Hanson is in the audience.
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