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The Banks
Does It Get Any Better For The Big Four?
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blacksheep
post Posted: Aug 8 2017, 08:31 PM
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Why do the senior executives of Australian banks get paid so much? It's complicated
The World Today By David Taylor
Updated about an hour ago


QUOTE
Ever wondered how much a banking executive gets paid? Unsurprisingly, the short answer is a lot.

The Commonwealth Bank's board has announced it will cut the bonuses of senior executives in response to last week's sensational allegations it breached anti-money-laundering laws.

But why are they paid so much in the first place?

The ABC spoke to two corporate governance experts who said Australian banking executives were among the highest paid in the world.

It starts with the bonus system..................................


http://www.abc.net.au/news/2017-08-08/why-...so-much/8785534

QUOTE
Bank chief executive salaries

Statutory pay may not represent the total remuneration package in order to comply with accounting standards. For example, Ian Narev's total pay was $12.3 million in 2015-16.

BANK CEO STATUTORY PAY (2015-16)
1 CBA Ian Narev $8.77 million
2 Westpac Brian Hartzer $6.7 million
3 ANZ Shayne Elliott $5.07 million
4 NAB Andrew Thorburn $6.7 million




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The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington

Said 'Thanks' for this post: early birds  
 
nipper
post Posted: Jul 24 2017, 11:11 AM
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QUOTE
The Australian Prudential Regulation Authority (APRA) has detailed its new capital adequacy targets for the banking sector, increasing the Common Equity Tier 1 ratios from 9% to 10.5% for the four majors and Macquarie, to make them "unquestionably strong". Regional bank proposed targets were raised from 7.0% to 7.5%. Banks will have until January 2020 to implement the increased requirements and the capital requirements are far less onerous than the market expected, making it a distinct possibility that they will be able to meet the increased levels organically.

The new APRA targets may result in interest rate increases on loans for the banks to recover additional costs and maintain profitability, which in turn could put further pressure on the RBA to stand pat on interest rates for longer.

Following the announcement of the new APRA targets, Standard and Poor's raised the possibility of an upgrade to the banks' "standalone credit profiles" (from 'A-' to 'A'), which would in turn lift the ratings in their subordinated debt and hybrids.

Outgoing ASIC chairman Greg Medcraft labelled as "ridiculous" the suitability of hybrid instruments for retail investors, noting they were banned for retail investors in other markets such as the UK. Whilst I can appreciate the intent to protect uninformed investors against risk in complex instruments, I would point out that there are far riskier investments available to retail investors in Australia. For example, Betashares Australian Equities Strong Bear Fund (ASX: BBOZ) allows investors to take a leveraged short position in the Australian equity market – a trade that has lost 43% over the past 1 ½ years.
- from Mint Securities



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

Said 'Thanks' for this post: early birds  
 
blacksheep
post Posted: Jul 19 2017, 01:56 PM
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extract from The Age

QUOTE
So what do the new capital requirements mean in numbers?

APRA this morning said for the banks to be considered "unquestionably strong" they will need to lift their tier 1 capital ratios to "at least 10.5 per cent" from current levels of around 9.5 per cent.

UBS banking analyst Jonathan Mott says APRA would expect the majors to operate comfortable above this minimum level and target capital ratios of 10.75 per cent to 11 per cent.

And while today's missive from the regulator didn't include changes to mortgage risk weights, Mott is convinced they will be tightened later this year, requiring further capital to be set aside.

To hit 10.75 per cent tier 1 capital, Mott has calculated the banks need to come up with an additional $7.9 billion. This rises to around $17.7 billion assuming mortgage risk weights rise from an average of 25 per cent to 30 per cent, he says.

Here are the capital requirements for each bank, according to Mott:

CBA has the largest capital shortfall at ~$4.2bn (rising to ~$6.5bn assuming higher mortgage risk weights)
WBC's shortfall is ~$1.5bn (~$5.4bn including higher risk weights)
NAB ~$1.7bn ($3.5bn including higher risk weights)
ANZ ~$490m (~$2.3bn post higher risk weights)
While the banks have been given until 2020 to hit these targets, Mott (as well as the banks themselves) predicts they will get there well ahead of time.


http://www.theage.com.au/business/markets-...718-gxe0df.html



--------------------
The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington

Said 'Thanks' for this post: early birds  
 
nipper
post Posted: Jul 19 2017, 12:18 PM
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Reducing risk of capital raisings .... Big 4 up 3-4%...



--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
Mags
post Posted: Jul 19 2017, 11:06 AM
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In Reply To: nipper's post @ Jul 17 2017, 02:13 PM

QUOTE
mmmm my, is it priced in?


I would luuurrrve to be in the closed door discussions, at:
A: Apra level
B: Bank board level
C: Treasury/political level.

I hardly think any of them can deny there's a bubble. How long they can prolong it, and what course of action when it goes must be the topic of discussion.

The latest round of foreign investor crack downs, were about calming the electorate, but not the markets.

Only last night I was speaking to a bloke in Adelaide, in the market for a home. I can't say exactly what he said (very politically incorrect, but we all know what it was), but if mobile phones are involved in the bidding, his advice is to leave immediately. If you stay to the fall of the hammer

A: You'll end up mad
B: You'll induce depression.
C: You'll realise there are people in this world who have money beyond most peoples wildest dreams......

Never, ever would I think that a democratically elected Australian government would sell their people out like this. I mean, we are the country that cuts down any tall poppy....unless you made your money in real estate, then you're held up as a god

Despite the fact by ripping off the working class, you've made the elite (bankers mostly) richer, while destroying the local retail and service industry.

 
nipper
post Posted: Jul 19 2017, 09:12 AM
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APRA, the prudential regulator has lifted the target for major Australian banks' equity capital ratio to "at least 10.5 per cent", up from the current level of around 9.5 per cent.

- mmmm my, is it priced in?



--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

Said 'Thanks' for this post: Mags  early birds  
 


nipper
post Posted: Jul 17 2017, 02:13 PM
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Posts: 5,223
Thanks: 1924


QUOTE
(Last week, t)he banks helped lift the market. Westpac (WBC) did best, up +2.7%, while Commonwealth Bank (CBA) (+1.2%), National Australia Bank (NAB) (+1.2%) and ANZ (ANZ) (+0.8%) all made gains.

This week will possibly see the release of the long-awaited paper from the Australian Prudential Regulation Authority (APRA), which oversees the financial industry, that will provide further guidance on what the banks must do in terms of capital reserves in order to meet the regulator's goal of an "unquestionably strong" financial system.

The lack of clarity over whether banks would be forced to raise more capital to bolster their reserves has overshadowed the sector for some time, as the next iteration of international Basel Accords – first mooted in 2014 - have failed to materialise and APRA have decided to go it alone in setting their requirements.

At this point the Big 4 banks are near 10% Core Tier 1 capital reserves; the stock price reaction to the new APRA paper will be driven by the size of the target and the degree to which the market believes it can be achieved organically via retained earnings, asset sales and dividend reinvestment programmes as opposed to an equity raising.

While we believe that the new target is unlikely to be too onerous, we remain underweight the Big 4 in aggregate. ANZ remains our preferred pick given that it is doing more to improve earnings in an environment of sluggish revenue growth – it alone among the Big 4 banks is looking to reduce costs in an absolute sense.
- BT





--------------------
"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

Said 'Thanks' for this post: early birds  
 
early birds
post Posted: Jul 4 2017, 11:00 AM
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In Reply To: Mags's post @ Jul 4 2017, 10:32 AM

i'm a grass hopper ---try to dig few bucks here and there. tongue.gif
for my trade--- NAB ---as i expected , it had jump start this morning, if it can get through 30.40, then my short term target {31.68ish} is most likely achievable.

i fully agree with you about our housing market----it is over heated
but we have mums paps---granpas granmas, even little kids all think that housing price will going up for ever, and plus short sight Govt.will do anything to help housing market
that is the fact that kept out housing booming till now
i do believe that one day "that shit will hit the fans} like GFC. but i got the day wrong, time and time again like you did. sadsmiley02.gif

hope the day comes sooner, so "smarties" like you and me can said words----" told you so".



 
Mags
post Posted: Jul 4 2017, 10:32 AM
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In Reply To: early birds's post @ Jul 4 2017, 09:36 AM

QUOTE
SA seems have other ideas for banks


Yeah, except it wasn't the LIb's that decided that, it was the electorate who were conned by the banks that this 'tax' was a bad idea. Marshall's leadership stinks, and if he let this through, that was his career ended right there. He was in a corner.

I'm generally very opinionated. I accept that.

But on this bank tax, I don't have any opinion. Perhaps because I know when the property market does fold, we'll all be bailing in/out the banks.

But when the populace in general run to the defence of billion dollar corporations, I have to question whether the populace know what their standing for.

#confused

 
early birds
post Posted: Jul 4 2017, 09:36 AM
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SA seems have other ideas for banks

look out for our banks to have jump start this morning

i had my NAB target for 31.68-----short term { within 5 trading days, ---might get there in three}

go for a upside trade for our banks today.. imho



 
 


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