WBK: Westpac Banking Corporation Instablogs

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Monday, May 20, 9:47 AM UBS' 5 "suspected" asset bubbles: 1) Risk-free rates - specifically Treasurys (TLT), Bunds (BUND, BUNL), JGBs (JGBL, JGBT, JGBD, JGBS) 2) Credit (HYG, JNK) 3) Real estate in Asia (WPS) 4) Certain EM equity markets (EIDO, IDXJ, EPHE, THD, EWW) 5) Australian banks (WBK, NABZY.PK, ANZBY.PK, CMWAY.PK). Comment!
Monday, April 8, 3:23 AM The Australian dollar will this week become the third currency to trade directly with the yuan as China continues the internationalization of its currency. The country's central bank has granted ANZ (ANZBY.PK) and Westpac (WBK) the rights to trade in the dollar and renminbi. With China being Australia's largest trading partner and buying over 25% of its exports, the move should help cut trading costs. Comment! [Global & FX]
Thursday, May 3, 2012, 7:28 AM "The biggest bubble in recent history is heading for the mother of all hard landings," writes SocGen's Albert Edwards, tagging onto his bearish partner-in-crime Dylan Grice's analysis of Australia. Channeling Minsky, Edwards notes the lack of volatility in Oz's economy (no recession since 1991) leads to an excessive build-up in debt and a "bigger crash down the road." 1 Comment [Global & FX]
Tuesday, May 1, 2012, 10:59 AM Among Australia's troubles are banks that can't pass on RBA rate cuts (50 bp last night) because - reliant on overseas markets - the lenders' funding costs are on the rise. "Infatuation" with Oz's debt (foreign ownership gov't bonds is skying) may be propping up the aussie, writes Anthony Doyle, but not for much longer. FXA -0.7%. Comment! [Global & FX, Financials]
Tuesday, May 1, 2012, 6:50 AM The Australian dollar is hammered - off 1.1% against the greenback - after the RBA cut rates by a greater-than-expected 50 basis points overnight. The central bank's statement is notable for its emphasis on Europe, not China, as a threat to the Aussie economy. Sydney +0.8%. Comment! [Global & FX, On the Move]
Wednesday, April 25, 2012, 4:43 PM Answer: Australia. Question (courtesy of Dylan Grice): "What do you call a credit bubble built on a commodity bull market built on a much bigger Chinese credit bubble?" The country has 5 of the world's most 15 expensive cities, runs a current account deficit despite booming commodity sales to China, and has seen a steep rise in debt/income. Shares: EWA +10.9% YTD, the aussie: FXA +1.1% YTD. 2 Comments [Global & FX]
Tuesday, April 24, 2012, 7:01 AM The stage is set for the RBA to cut rates after Australia's CPI rises just 0.1% in Q1 against expectations for 0.6%. Annual inflation comes in at 1.6% vs. 2.1% expected. The central bank has made clear only this CPI report stood between the current 4.25% benchmark and something lower. It meets on May 1. Aussie -0.4% to $1.0280. Comment! [Global & FX]
Wednesday, April 18, 2012, 3:01 PM Might Genworth's (GNW -21%) delay of its Australian mortgage insurance business IPO be ringing a bell for the Oz property market? The company cites deteriorating market conditions in the Aussie mortgage market "as lenders accelerated the processing of late-stage delinquencies ... at a higher rate and severity than expected." Westpac WBK -1%. 1 Comment [Financials, Global & FX]
Tuesday, March 27, 2012, 3:41 PM "When we've gone through our book, we've seen signs of rapid property value decretion," says Stuart Grimshaw, MD at Bank of Queensland of the lender's expected H1 loss due to loan impairments. He expects continued challenges in coming years, much of it due to the powerful Aussie dollar. FXA remains near all-time highs. 2 Comments [Global & FX]
Monday, March 12, 2012, 3:21 PM Investors can catch great deals with the stocks of a number of largely-overlooked global companies that strike close to the heart of value investors with their "extremely cheap" valuations and provide income-oriented investors a generous yield to latch onto, according to Morningstar. ADRs Making the grade: [MT, FTE, DCM, SU, WBK, RDS.A, AMX, and TEVA. Comment! [Quick Ideas, Global & FX]
Saturday, March 10, 2012, 8:15 AM Barbara Kollmeyer highlights five of the cheapest dividend stocks from key global industries - stocks that may not be the biggest multinationals, but sport significant dividends and value: MT, FTE, DCM, SU and WBK. 6 Comments [Quick Ideas]
Friday, February 10, 2012, 6:36 AM Also weighing on Oz, Westpac (WBK) and ANZ (ANZBY.PK) both hike mortgage rates even with the RBA in the midst of an easing cycle. Australian banks are unusually dependent on overseas funding markets, and find their margins being squeezed. "The RBA's cash rate alone in not an accurate reflection of bank funding costs," says ANZ. (previous) Comment! [Financials, Global & FX]
Tuesday, January 31, 2012, 7:17 AM Australia's major banks - needing to raise $100B in 2012, dealing with a reversal in the country's bubbly property market, and facing an economy gasping for air in all but the mining sector - have been put on negative ratings watch by Fitch. The good news is the RBA's 4.25% benchmark rate - there's a lot of room for funding costs to decline. Comment! [Global & FX, Financials]
Tuesday, November 1, 2011, 12:03 AM Easier monetary policy comes to Australia, where the RBA - as most anticipated - cuts its benchmark rate 25 basis points to 4.5%. Governor Glenn Stevens gives expected nods to the slowdown in China and falling inflation in Oz, but saves particular emphasis for "trade performance ... see(ing) some effects of a significant slowing in economic activity in Europe." The aussie slips a bit to $1.0490. Shares -1.9%. Comment! [Global & FX]
Friday, October 7, 2011, 8:09 AM The IMF sounds a bit of warning on Australia, saying the RBA may need to continue hiking rates to fight inflation even as slowing world economic growth cuts demand for commodities. The country is also particularly vulnerable to financial tumult as its banks are heavily reliant on overseas funding. 2 Comments [Global & FX]
Tuesday, October 4, 2011, 8:39 AM The neckbone is connected to the headbone... Tim Backshall has a look at CDS spreads in some Australian corporate names, noting that some blew out last night. Among the hardest hit are mining giants Rio Tinto (RIO) and BHP, whose spreads jumped about 30%. Comment! [Global & FX, Commodities, Financials]

WBK Westpac Banking Corporation

WBK

Westpac Banking Corporation