Mediaportal Report. News Headlines... News Headlines... MON 19 NOVEMBER 2018

Transcription

1 MON 19 NOVEMBER 2018 Mediaportal Report News Headlines... ABC Radio Sydney, Sydney, Breakfast, Wendy Harmer and Robbie Buck 19 Nov :35 AM Duration: 0 min 58 secs ASR AUD 1,985 NSW Australia Industry Super Australia - Radio & TV ID: X News Headlines - The APEC economic summit in Papua New Guinea has ended without a formal leaders' statement due to divisions between United States and China over trade. - The Banking Royal Commission begins its final round of public hearings in Sydney today. - NSW Corrections Minister David Elliott has requested an urgent briefing after it was revealed a parolee allegedly sexually assaulted a seven year old girl in Kogarah last week. - A 38yo man is due in Goulburn Court today on money-laundering charges. - An Australian climber has been killed during a rock fall in the Himalayas. - New research has found almost two million Australian adults are taking prescriptions opioid every year. 87,000 All, 39,000 MALE 16+, 47,000 FEMALE 16+ Interviewees Toni Mathews, news presenter, ABC Radio Sydney News Headlines... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 19 Nov :30 AM Duration: 1 min 45 secs ASR AUD 27,070 National Australia Industry Super Australia - Radio & TV ID: X News Headlines - Police are investigating the death of an infant at Surfers Paradise. - World leaders have failed to agree on a final statement at the end of the APEC summit. Prime Minister Scott Morrison remains in PNG to talk about defence cooperation. - The heads of CBA, Macquarie, MP and Westpac will face the final round of hearings of the Banking Royal Commission. - US President Donald Trump says he's been briefed on the audio allegedly documenting the murder of Saudi journalist Jamal Khashoggi. 271,000 All, 132,000 MALE 16+, 138,000 FEMALE 16+ Interviewees Donald Trump, US President [excerpt] Vision CBA Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) COPYRIGHT This report and its contents are for the internal research use of Mediaportal subscribers only and must not be provided to any third party by any means for any purpose without the express permission of Isentia and/or the relevant copyright owner. For more information contact copyright@isentia.com DISCLAIMER Isentia makes no representations and, to the extent permitted by law, excludes all warranties in relation to the information contained in the report and is not liable for any losses, costs or expenses, resulting from any use or misuse of the report.

2 Interview with Peter Ryan, Senior Business Correspondent, ABC. Lane reports that the... Radio National, Canberra, AM, Sabra Lane Duration: 4 mins 56 secs ASR AUD 228,227 National Australia Industry Super Australia - Radio & TV ID: X Nov :18 AM Interview with Peter Ryan, Senior Business Correspondent, ABC. Lane reports that the Financial Services Royal Commission will hit a crescendo during the next fortnight when the bosses of the big four banks are expected to face intense questioning over misconduct. This will be the last round of hearings before Kenneth Hayne delivers his final report early next year. Ryan says the Royal Commission has not put out a specific witness list as it has in the past, but it has confirmed that the Commonwealth Bank will go first. Ryan says CEO Matt Comyn and Chairman Catherine Livingstone have undergone intense preparation in the lead up to the final hearings. He adds that other institutions that will face questioning this week are the Macquarie Group, Westpac, and ASIC. Ryan says next week's companies for questioning will be ANZ, NAB, AMP, and banking regulator APRA. He says a key issue is whether lucrative bonuses have tempted bankers to act in their own interest. Ryan says Macquarie University's Department of Applied Finance concludes that bonuses don't necessarily improve productivity at all. Elizabeth Sheedy, associate professor, Macquarie Applied Finance Centre, says bonuses have contributed to some of the misconduct that has emerged from the Royal Commission. She says fixing the renumeration system will help restore a good culture in financial services, but there are other things that need to be worked on first. Ryan says more than a hundred executives have faced the Royal Commission so far, with 16 losing their jobs as a direct result of it. AMP boss Craig Meller, AMP chairman Catherine Brenner, and NAB's Andrew Hagger, have all lost their jobs. 140,000 All, 68,000 MALE 16+, 72,000 FEMALE 16+ Interviewees Elizabeth Sheedy, associate professor, Macquarie Applied Finance Centre [excerpt] Peter Ryan, Senior Business Correspondent, ABC Also broadcast from the following 9 stations Radio Australia (Asia Pacific) (Sydney), Radio National (Sydney), Radio National (Melbourne), Radio National (Brisbane), Radio National (Perth), Radio National (Hobart), Radio National (Adelaide), Radio National (Darwin), Radio National (Newcastle) Comperes are joined by ABC business reporter Daniel Ziffer. Comperes say the heads of... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 19 Nov :09 AM Duration: 3 mins 37 secs ASR AUD 40,082 National Australia Industry Super Australia - Radio & TV ID: X Comperes are joined by ABC business reporter Daniel Ziffer. Comperes say the heads of the big four banks will take the stand at the final round of hearings of the Banking Royal Commission before Commissioner Kenneth Hayne's final report. Ziffer says six different hearings had been held on superannuation and insurance. He says a full fortnight had been set aside ahead of the final report in February. Ziffer says CBA chair Catherine Livingstone and CBA CEO Matt Comyn will open today's hearing. He says the bank were previously found working against the best interest of customers. Ziffer thinks everyone of the executives have tough questions to answer, including a few extras such as Macquarie Bank and the financial regulators. He says ANZ, CBA, NAB and Westpac have appalling cases to discuss. 190,000 All, 94,000 MALE 16+, 91,000 FEMALE 16+ Interviewees Daniel Ziffer, ABC business reporter Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

3 The banking royal commission will resume this morning in Sydney. Chief executives and... ABC Radio Melbourne, Melbourne, 07:00 News, Newsreader 19 Nov :06 AM Duration: 0 min 42 secs ASR AUD 9,608 VIC Australia Industry Super Australia - Radio & TV ID: X The banking royal commission will resume this morning in Sydney. Chief executives and chairs of some of the bank boards are expected to face a grilling in the royal commission. Commonwealth Bank will be the first bank to face the inquiry. 124,000 All, 58,000 MALE 16+, 62,000 FEMALE 16+ Interviewees Shumi Akhtar, associate professor, University of Sydney Business School Also broadcast from the following 9 stations ABC Ballarat (Ballarat), ABC Central Victoria (Bendigo), ABC Gippsland (Sale), ABC Goulburn Murray (Wodonga), ABC Mildura - Swan Hill (Mildura), ABC Shepparton (Shepparton), ABC South Western Victoria (Warrnambool), ABC Western Victoria (Horsham), Radio National (Melbourne) Bosses of the big four banks are preparing to appear at the Royal Commission's final... 2GB, Sydney, 07:00 News, Newsreader 19 Nov :00 AM Duration: 0 min 38 secs ASR AUD 2,385 NSW Australia Industry Super Australia - Radio & TV ID: X Bosses of the big four banks are preparing to appear at the Royal Commission's final round of public hearings. Matt Comyn, CEO, Commonwealth Bank, will be the first to appear. 215,000 All, 98,000 MALE 16+, 115,000 FEMALE 16+ Also broadcast from the following 13 stations 2BS (Bathurst), 2EC (Bega), 2GN (Goulburn), 2LT (Lithgow), 2MAX (Narrabri), 2NUR (Newcastle), 2QN (Deniliquin), 2XL (Cooma), 2YOU FM (Tamworth), Coast FM (Gosford), Great Lakes FM (Taree), Macquarie Sports Radio (Sydney), Magic 2CH (Sydney) News Headlines... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 19 Nov :00 AM Duration: 0 min 40 secs ASR AUD 7,389 National Australia Industry Super Australia - Radio & TV ID: X News Headlines - Police are investigating the death of a baby on the Gold Coast. - World leaders are divided on trade at the end of the APEC summit. - CEOs are feeling the heat of the final round of hearings in the Banking Royal Commission. - An F3 driver survives a crash at the Macau Grand Prix. - Author Lee Child will join the program. 190,000 All, 94,000 MALE 16+, 91,000 FEMALE 16+ Vision ANZ, CBA, NAB, Westpac Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

4 Kelly is joined by ABC business reporter Michael Janda. Janda and Kelly discuss... Radio National, Canberra, Breakfast (Early), Fran Kelly Duration: 8 mins 20 secs ASR AUD 361,617 National Australia Industry Super Australia - Radio & TV ID: X Nov :52 AM Kelly is joined by ABC business reporter Michael Janda. Janda and Kelly discuss Commissioner Kenneth Hayne's Banking Royal Commission which has already heard evidence of misconduct across retail banking, financial planning, insurance, small business lending, and superannuation. Janda names some of the major bank officials who will be facing the commission this week, starting with Commonwealth Bank Chairwoman Catherine Livingstone and CEO Matt Comyn later today, followed by Sydney banks Westpac and Macquarie. Janda adds this week's hearings will be rounded out by ASIC, while next week APRA will be rounding out hearings for AMP, ANZ, NAB, and Bendigo and Adelaide Bank in Melbourne. Janda says he believes the focus of the final round of hearings will be on governance and culture within banks, specifically making sure that incentives are aligned with customers' interests so that staff do not milk them for their money. Janda adds another topic he believes will be the focus of the commission is remuneration applicable to third parties such as financial planners and mortgage brokers. Janda says the challenge for Hayne's commission is to make recommendations that ensure the banks don't return to their old ways once the commission stops scrutinising them. Janda also mentions an interview with Macquarie University's Elizabeth Sheedy by ABC senior business correspondent Peter Ryan on some of the risk cultures in the banking system. Kelly and Janda discuss a new study from the Centre for Independent Studies showing that many Australians across income levels believe Australia should cut down or pause its immigration intake until infrastructures are able to cope with the demands. Janda plays a clip of Jeremy Sammut, the Director of the Centre's Culture, Prosperity and Civil Society Program, who says the survey shows an increasing concern about immigration affecting people's quality of life issues. Janda also mentions the Bureau of Statistics is set to publish its latest population projections on Thursday. Janda mentions how the Fair Work Commission has found online food delivery company Foodora guilty of unfairly dismissing an employee. Janda gives updates on the local share market. 140,000 All, 68,000 MALE 16+, 72,000 FEMALE 16+ Interviewees Michael Janda, business reporter, ABC Jeremy Sammut, director of the Culture, Prosperity and Civil Society Program, Centre for Independent Studies [excerpt] Also broadcast from the following 8 stations Radio National (Sydney), Radio National (Melbourne), Radio National (Brisbane), Radio National (Perth), Radio National (Hobart), Radio National (Adelaide), Radio National (Darwin), Radio National (Newcastle) Regular Segment: Week in News with The Squiz Editor Claire Kimball... ABC Radio Melbourne, Melbourne, Breakfast, Jacinta Parsons and Sami Shah 19 Nov :40 AM Duration: 4 mins 12 secs ASR AUD 8,328 VIC Australia Industry Super Australia - Radio & TV ID: X Regular Segment: Week in News with The Squiz Editor Claire Kimball. Parsons says the Banking Royal Commission is preparing today for its seventh round. She wonders if it is the last one. Kimball presumes there could be extensions and today's round will probably be crucial to deciding how further the case goes. She recalls then-treasurer Scott Morrison trying to oppose having the Royal Commission and then had to track and say it was the right thing to do. She presumes it is impossible not to take action after everyone has agreed it was the right thing to do. Parsons notes ASIC and APRA will also be under scrutiny. Kimball adds they have received criticism already. [cont] 84,000 All, 32,000 MALE 16+, 48,000 FEMALE 16+ Interviewees Claire Kimball, Editor, The Squiz COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

5 Program Preview... Radio National, Canberra, Breakfast (Early), Fran Kelly 19 Nov :35 AM Duration: 0 min 49 secs ASR AUD 35,438 National Australia Industry Super Australia - Radio & TV ID: X Program Preview - Discussion with ABC business reporter Michael Janda on Commissioner Kenneth Hayne's Banking Royal Commission. 140,000 All, 68,000 MALE 16+, 72,000 FEMALE 16+ Also broadcast from the following 8 stations Radio National (Sydney), Radio National (Melbourne), Radio National (Brisbane), Radio National (Perth), Radio National (Hobart), Radio National (Adelaide), Radio National (Darwin), Radio National (Newcastle) The final round of hearings for the Banking Royal Commission is set to begin, with... 5AA, Adelaide, 06:30 News, Newsreader 19 Nov :35 AM Duration: 0 min 36 secs ASR AUD 349 SA Australia Industry Super Australia - Radio & TV ID: X The final round of hearings for the Banking Royal Commission is set to begin, with Commonwealth Bank CEO Matt Comyn will be the first to appear. The bosses of ANZ, NAB, and Westpac will also be grilled about the measures they have implemented to prevent misconduct over the coming fortnight. The heads of the industry's two main regulators will also appear after they were accused of allowing wrongdoing to go unpunished. The Commissioner's final report will be handed down by February ,000 All, 18,000 MALE 16+, 23,000 FEMALE 16+ The Banking Royal Commission begins its final round of public hearings in Sydney this... ABC Radio Adelaide, Adelaide, 06:30 News, Newsreader 19 Nov :31 AM Duration: 0 min 42 secs ASR AUD 562 SA Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission begins its final round of public hearings in Sydney this morning with bank CEOs and chairman among those set to be questioned. Commonwealth Bank will be the first to give evidence since Commissioner Kenneth Hayne delivered a scathing interim report on the sector. University of Sydney Business School associate professor of finance Shumi Akhtar claims the CEOs should be asked on their personal accountability. 34,000 All, 16,000 MALE 16+, 17,000 FEMALE 16+ Interviewees Shumi Akhtar, associate professor of finance, University of Sydney Business School The heads of Australia's big four banks will be grilled when they face the Royal... 4BC, Brisbane, 06:30 News, Newsreader 19 Nov :31 AM Duration: 0 min 12 secs ASR AUD 218 QLD Australia Industry Super Australia - Radio & TV ID: X The heads of Australia's big four banks will be grilled when they face the Royal Commission into Banking's final round of public hearings. The CEO of Commonwealth Bank will be the first to appear in the two-week block of hearings. 22,000 All, 13,000 MALE 16+, 9,000 FEMALE 16+ Also broadcast from the following 3 stations 1071 AM (Kingaroy), 4LG (Longreach), Radio 4KZ (Innisfail) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

6 The heads of Australia's big four banks will be grilled when they face the Banking Royal... 2GB, Sydney, 06:30 News, Newsreader 19 Nov :31 AM Duration: 0 min 8 secs ASR AUD 792 NSW Australia Industry Super Australia - Radio & TV ID: X The heads of Australia's big four banks will be grilled when they face the Banking Royal Commission's final round of public hearings. 215,000 All, 98,000 MALE 16+, 115,000 FEMALE 16+ Also broadcast from the following 12 stations 2BS (Bathurst), 2EC (Bega), 2GN (Goulburn), 2LT (Lithgow), 2MAX (Narrabri), 2QN (Deniliquin), 2XL (Cooma), 2YOU FM (Tamworth), Coast FM (Gosford), Great Lakes FM (Taree), Macquarie Sports Radio (Sydney), Magic 2CH (Sydney) The Banking Royal Commission will begin its final round of public hearings this morning.... ABC Radio Sydney, Sydney, 06:30 News, Newsreader 19 Nov :30 AM Duration: 0 min 37 secs ASR AUD 1,529 NSW Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission will begin its final round of public hearings this morning. Kenneth Hayne, Commissioner's scathing interim report criticised the banking industry's culture of greed. CBA, Westpac, and Macquarie Group will face scrutiny in Sydney this week before the inquiry returns to Melbourne. 100,200 All, 42,700 MALE 16+, 52,300 FEMALE 16+ Also broadcast from the following 1 station ABC Central Coast (Erina) The final rounds of hearing of the Banking Royal Commission kicks off in Sydney later... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 19 Nov :05 AM Duration: 0 min 17 secs ASR AUD 1,406 National Australia Industry Super Australia - Radio & TV ID: X The final rounds of hearing of the Banking Royal Commission kicks off in Sydney later today. The CEOs of CBA, Macquarie Bank, AMP and Westpac will give evidence, with the hearings focusing on the causes of misconduct by the financial services. 76,000 All, 42,000 MALE 16+, 32,000 FEMALE 16+ Vision CBA, Westpac Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

7 Program Preview... Radio National, Canberra, Breakfast (Early), Fran Kelly 19 Nov :05 AM Duration: 2 mins 3 secs ASR AUD 43,741 National Australia Industry Super Australia - Radio & TV ID: X Program Preview - Interview with Melbourne ophthalmologist and Professor Hugh Taylor about the stubborn gap in Indigenous eye health. Aboriginal Torres Strait Islander children have better vision than mainstream ones. However, Aboriginal Torres Strait Islanders have six times more blindness and three times more low vision when they reached 14yo and above. Taylor leads The Roadmap to Closing the Gap for Indigenous Eye Health project [sic]. - Interview with ANU's Asia expert Michael Wesley. The conflict between China and the US was seen publicly on weekend at the APEC Summit in Port Moresby. The forum failed to concur on a final communique, which is the first in APEC's 30 year history. The US has announced its intention to compete with China's military presence in the region and funding of ailing infrastructures in Papua New Guinea such as electricity. The action is part of the renewed cooperation with Australia in the Pacific. - Interview with Federal Defence Minister Christopher Pyne. - Discussion with RN business correspondent Michael Janda. Big banks will face the Hayne Royal Commission again this week. Commonwealth Banks' CEO Matt Comyn and chairman Catherine Livingstone will be the first to face the commission. 58,000 All, 28,000 MALE 16+, 31,000 FEMALE 16+ Interviewees Hugh Taylor, ophthalmologist Also broadcast from the following 8 stations Radio National (Sydney), Radio National (Melbourne), Radio National (Brisbane), Radio National (Perth), Radio National (Hobart), Radio National (Adelaide), Radio National (Darwin), Radio National (Newcastle) The head of Australia's big four banks will have to answer for the misconduct which... 5AA, Adelaide, 06:00 News, Newsreader 19 Nov :05 AM Duration: 0 min 21 secs ASR AUD 203 SA Australia Industry Super Australia - Radio & TV ID: X The head of Australia's big four banks will have to answer for the misconduct which happened under their watch when they face the Banking Royal Commission over the next two weeks. They will also be joined by the Commonwealth Bank 's CEO and Chairwoman. Consumer advocates say apologies will not be enough and Australians deserve action. 22,000 All, 10,000 MALE 16+, 12,000 FEMALE 16+ Also broadcast from the following 3 stations 5CS (Port Pirie), 5MU (Murray Bridge), 5RM (Berri) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

8 The Banking Royal Commission resumes in Sydney this morning, with the chief... ABC Radio Darwin, Darwin, 06:00 News, Newsreader 19 Nov :04 AM Duration: 0 min 41 secs ASR AUD 168 NT Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission resumes in Sydney this morning, with the chief executives and the chairs of some of the bank boards expected to face a grilling over the next fortnight. Commonwealth Bank is set to be the first bank to front the inquiry. University of Sydney Business School Associate Professor of Finance, Shumi Akhtar, says the CEOs' futures could depend on their performance at the commission. N/A All, N/A MALE 16+, N/A FEMALE 16+ Interviewees Shumi Akhtar, associate professor of finance, University of Sydney Business School Also broadcast from the following 1 station ABC Alice Springs (Alice Springs) The Banking Royal Commission commences its final round of public hearings in Sydney... ABC Radio Melbourne, Melbourne, 06:00 News, Newsreader 19 Nov :03 AM Duration: 0 min 44 secs ASR AUD 4,150 VIC Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission commences its final round of public hearings in Sydney today with bank CEOs and chairmen among those to be interrogated. Australia's largest bank, Commonwealth Bank, will be the first to provide evidence since Commissioner Kenneth Hayne gave a scathing interim report. Shumi Akhtar, associate professor of finance, University of Sydney Business School, claims the CEOs should be asked on their personal accountability. 63,000 All, 34,000 MALE 16+, 28,000 FEMALE 16+ Interviewees Shumi Akhtar, associate professor of finance, University of Sydney Business School Also broadcast from the following 9 stations ABC Ballarat (Ballarat), ABC Central Victoria (Bendigo), ABC Gippsland (Sale), ABC Goulburn Murray (Wodonga), ABC Mildura - Swan Hill (Mildura), ABC Shepparton (Shepparton), ABC South Western Victoria (Warrnambool), ABC Western Victoria (Horsham), Radio National (Melbourne) The Banking Royal Commission will begin its final round of public hearings in Sydney this... ABC Radio Canberra, Canberra, 06:00 News, Newsreader 19 Nov :01 AM Duration: 0 min 43 secs ASR AUD 118 ACT Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission will begin its final round of public hearings in Sydney this morning with bank chief executives and chairman among those set to be enquired. The Commonwealth Bank will be the first to give evidence at the inquiry's first sitting since Kenneth Hayne, Commissioner delivered a scathing interim report on the industry. Shumi Akhtar, associate professor of finance, University of Sydney Business School says the bank's chief executive should be questioned about their personal accountability. 7,000 All, 2,000 MALE 16+, 5,000 FEMALE 16+ Interviewees Shumi Akhtar, associate professor of finance, University of Sydney Business School COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

9 The bosses of the Big Four Banks are preparing to appear at the Royal Commission's... 4BC, Brisbane, 06:00 News, Newsreader 19 Nov :01 AM Duration: 0 min 38 secs ASR AUD 1,729 QLD Australia Industry Super Australia - Radio & TV ID: X The bosses of the Big Four Banks are preparing to appear at the Royal Commission's last public hearing, which will take place over two weeks. They will focus on issues of culture and risk management processes. Matt Comyn, Chief Executive, Commonwealth Bank will be the first to appear and is set to be questioned on how systemic issues escalated during his tenure and what has been done to stop them from happening again. The final report is expected to be handed down by February ,000 All, 10,000 MALE 16+, 8,000 FEMALE 16+ Also broadcast from the following 7 stations 1071 AM (Kingaroy), 4BU (Bundaberg), 4CRB FM (Gold Coast), 4LG (Longreach), Hitz FM (Bundaberg), Radio 4KZ (Innisfail), Zinc 666 (Mt Isa) Big four banks' bosses are getting ready to appear at the final public hearing of the Royal... 2CC, Canberra, 06:00 News, Newsreader 19 Nov :00 AM Duration: 0 min 34 secs ASR AUD 60 ACT Australia Industry Super Australia - Radio & TV ID: X Big four banks' bosses are getting ready to appear at the final public hearing of the Royal Commission. It is set to take place over two weeks, focusing on issues of culture and risk management processes. Commonwealth Bank Chief Executive Matt Comyn is set to appear first and is expected to be questioned about how systemic issues escalated on his watch and what's been done to prevent them from happening again. The Commissioner's final report will be handed down by February ,000 All, 2,000 MALE 16+, 2,000 FEMALE 16+ Also broadcast from the following 1 station 2CA (Canberra) News Headlines... ABC News, Sydney, News Breakfast, Michael Rowland, Virginia Trioli and Paul Kennedy 19 Nov :00 AM Duration: 0 min 40 secs ASR AUD 3,314 National Australia Industry Super Australia - Radio & TV ID: X News Headlines - Police are investigating the death of a baby on the Gold Coast. - World leaders are divided on trade at the end of the APEC summit. - CEOs are feeling the heat of the final round of hearings in the Banking Royal Commission. - US President Donald Trump has been briefed on the audio recordings of Jamal Khashoggi's murder. - An F3 driver survives a crash at the Macau Grand Prix. 76,000 All, 42,000 MALE 16+, 32,000 FEMALE 16+ Vision ANZ, CBA, NAB, Westpac Also broadcast from the following 22 stations ABC (Hobart), ABC (Darwin), ABC (Sydney), ABC (Brisbane), ABC (Adelaide), ABC (Melbourne), ABC (Perth), ABC (Canberra), ABC (Regional Queensland), ABC (Regional Victoria), ABC (Regional NSW), ABC (Albany), ABC News (Melbourne), ABC News (Regional NSW), ABC News (Brisbane), ABC News (Adelaide), ABC News (Perth), ABC News (Regional Queensland), ABC News (Hobart), ABC News (Canberra), ABC News (Regional Victoria), ABC News (Regional West Australia) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

10 Commonwealth Bank CEO Matt Comyn will be facing the Financial Services Royal... Smooth FM 95.3, Sydney, 06:00 News, Newsreader 19 Nov :00 AM Duration: 0 min 22 secs ASR AUD 297 NSW Australia Industry Super Australia - Radio & TV ID: X Commonwealth Bank CEO Matt Comyn will be facing the Financial Services Royal Commission's final public hearing this morning regarding the Commonwealth's plans addressing issues raised at the Commission on the bank's conduct. The CEOs of ANZ, National Australia Bank, and Westpac will also be questioned ahead of a final report due February next year. 30,000 All, 12,000 MALE 16+, 16,000 FEMALE 16+ The CEOs of the big four banks and AMP will today appear at the final public hearing of... WS FM, Sydney, 06:00 News, Newsreader 19 Nov :58 AM Duration: 0 min 20 secs ASR AUD 373 NSW Australia Industry Super Australia - Radio & TV ID: X The CEOs of the big four banks and AMP will today appear at the final public hearing of the Banking Royal Commission. 56,000 All, 36,000 MALE 16+, 17,000 FEMALE 16+ The Banking Royal Commission starts its final round of public hearings in Sydney this... ABC Radio Brisbane, Brisbane, 05:30 News, Newsreader 19 Nov :33 AM Duration: 0 min 47 secs ASR AUD 422 QLD Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission starts its final round of public hearings in Sydney this morning involving bank chief executives and chairman due to be questioned. Australia's largest bank Commonwealth will be the first to give evidence at the inquiry's first sitting since Commissioner Kenneth Hayne delivered the scathing interim report in the sector. Sydney University Business School's Shumi Akhtar says bank executives must be questioned on their personal accountability. 22,000 All, 10,000 MALE 16+, 11,000 FEMALE 16+ Interviewees Shumi Akhtar, Sydney University Business School The Banking Royal Commission starts its final round of public hearings in Sydney this... ABC Radio Sydney, Sydney, 05:30 News, Newsreader 19 Nov :32 AM Duration: 0 min 41 secs ASR AUD 1,518 NSW Australia Industry Super Australia - Radio & TV ID: X The Banking Royal Commission starts its final round of public hearings in Sydney this morning involving bank chief executives and chairman due to be questioned. Australia's largest bank Commonwealth will be the first to give evidence at the inquiry's first sitting since Commissioner Kenneth Hayne delivered the scathing interim report in the sector. Sydney University Business School's Shumi Akhtar says bank executives must be questioned on their personal accountability. 45,100 All, 27,600 MALE 16+, 15,500 FEMALE 16+ Interviewees Shumi Akhtar, Sydney University Business School Also broadcast from the following 10 stations ABC Central Coast (Erina), ABC Central West NSW (Orange), ABC Coffs Coast (Coffs Harbour), ABC Illawarra (Wollongong), ABC New England North West (Tamworth), ABC North Coast NSW (Lismore), ABC Riverina (Wagga Wagga), ABC South East NSW (Bega), ABC Upper Hunter (Muswellbrook), ABC Western Plains NSW (Dubbo) COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

11 Plumber accused of $16-an-hour rip-off The Australian, Australia, General News, Ewin Hannan 19 Nov 2018 Page words ASR AUD 4,631 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 387 word(s), ~1 min 94,448 CIRCULATION Companies must behave: Mirvac The Australian, Australia, Business News, Turi Condon 19 Nov 2018 Page words ASR AUD 15,796 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 599 word(s), ~2 mins 94,448 CIRCULATION Community in 'trust deficit' with business The Australian, Australia, General News, Turi Condon Ben Butler 19 Nov 2018 Page words ASR AUD 4,013 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 371 word(s), ~1 min 94,448 CIRCULATION AustralianSuper taps Towning to revive global returns Australian Financial Review, Australia, Property, Nick Lenaghan 19 Nov 2018 Page words ASR AUD 2,832 Photo: No Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 318 word(s), ~1 min 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

12 Litigation wave would hamper change Australian Financial Review, Australia, Companies and Markets, James Eyers 19 Nov 2018 Page words ASR AUD 5,765 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 633 word(s), ~2 mins 44,635 CIRCULATION ACCC gave CBA a pass on cartel breach Australian Financial Review, Australia, Companies and Markets, James Frost 19 Nov 2018 Page words ASR AUD 7,929 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 554 word(s), ~2 mins 44,635 CIRCULATION Shine of bank shares dims Adelaide Advertiser, Adelaide, Business News, David Libby Koch 19 Nov 2018 Page words ASR AUD 12,138 Photo: Yes Type: News Item Size: cm² SA Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 112,097 CIRCULATION Employers to pay price for skimping on super Adelaide Advertiser, Adelaide, Business News, Anthony Keane 19 Nov 2018 Page words ASR AUD 3,332 Photo: Yes Type: News Item Size: cm² SA Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 112,097 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

13 Shine of bank shares dims Daily Telegraph, Sydney, Business News, David Libby Koch 19 Nov 2018 Page words ASR AUD 37,802 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 232,067 CIRCULATION Employers to pay price for skimping on super Daily Telegraph, Sydney, Business News, Anthony Keane 19 Nov 2018 Page words ASR AUD 16,302 Photo: Yes Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 232,067 CIRCULATION Banks' big sell on pay fails to filter down Australian Financial Review, Australia, Companies and Markets, James Eyers 19 Nov 2018 Page words ASR AUD 9,891 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 744 word(s), ~2 mins 44,635 CIRCULATION CBA chiefs enter world of Hayne Australian Financial Review, Australia, General News, James Frost 19 Nov 2018 Page words ASR AUD 7,848 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 1013 word(s), ~4 mins 44,635 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

14 Bank bonuses 'boost risk, not profits' Australian Financial Review, Australia, General News, Duncan Hughes 19 Nov 2018 Page words ASR AUD 6,735 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 601 word(s), ~2 mins 44,635 CIRCULATION BANK BOSSES IN THE DOCK Australian Financial Review, Australia, General News, James Eyers 19 Nov 2018 Page words ASR AUD 27,205 Photo: Yes Type: News Item Size: 1, cm² National Australia Industry Super Australia - Press ID: View original - Full text: 2335 word(s), ~9 mins 44,635 CIRCULATION Shine of bank shares dims Courier Mail, Brisbane, Business News, David Libby Koch 19 Nov 2018 Page words ASR AUD 14,103 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 135,007 CIRCULATION THE DEMOCRACY BLUES Age, Melbourne, General News, Jessica Irvine 19 Nov 2018 Page words ASR AUD 125,930 Photo: Yes Type: News Item Size: 2, cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 2658 word(s), ~10 mins 83,229 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

15 Bank top brass to face the music Age, Melbourne, General News, Clancy Yeates Sarah Danckert 19 Nov 2018 Page words ASR AUD 8,783 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 267 word(s), ~1 min 83,229 CIRCULATION Super boost hardly over the top Australian Financial Review, Australia, Letters 19 Nov 2018 Page words ASR AUD 2,104 Photo: No Type: Letter Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 273 word(s), ~1 min 44,635 CIRCULATION Common thread Australian Financial Review, Australia, General News, Adele Ferguson 19 Nov 2018 Page words ASR AUD 10,235 Photo: Yes Type: News Item Size: cm² National Australia Industry Super Australia - Press ID: View original - Full text: 860 word(s), ~3 mins 44,635 CIRCULATION Bank bosses next to face the music Sydney Morning Herald, Sydney, General News, Clancy Yeates Sarah Danckert 19 Nov 2018 Page words ASR AUD 20,155 Photo: No Type: News Item Size: cm² NSW Australia Industry Super Australia - Press ID: View original - Full text: 480 word(s), ~1 min 88,634 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

16 Bank chiefs face probe 'blowtorch' Hobart Mercury, Hobart, General News 19 Nov 2018 Page words ASR AUD 788 Photo: No Type: News Item Size: cm² TAS Australia Industry Super Australia - Press ID: View original - Full text: 221 word(s), <1 min 28,265 CIRCULATION Banking chiefs to face probe blowtorch West Australian, Perth, General News, Nick Evans 19 Nov 2018 Page words ASR AUD 3,278 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 296 word(s), ~1 min 147,676 CIRCULATION Shine of bank shares dims Hobart Mercury, Hobart, Business News, David Libby Koch 19 Nov 2018 Page words ASR AUD 5,848 Photo: Yes Type: News Item Size: cm² TAS Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 28,265 CIRCULATION Employers to pay price for skimping on super Hobart Mercury, Hobart, Business News, Anthony Keane 19 Nov 2018 Page words ASR AUD 1,626 Photo: Yes Type: News Item Size: cm² TAS Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 28,265 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

17 Insurers say new changes unfair Canberra Times, Canberra, General News, Katie Burgess 19 Nov 2018 Page words ASR AUD 9,810 Photo: No Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: View original - Full text: 708 word(s), ~2 mins 17,579 CIRCULATION Bank bosses to face Hayne grilling Canberra Times, Canberra, General News 19 Nov 2018 Page words ASR AUD 2,587 Photo: No Type: News Item Size: cm² ACT Australia Industry Super Australia - Press ID: View original - Full text: 225 word(s), <1 min 17,579 CIRCULATION Employers to pay price for skimping on super Northern Territory News, Darwin, Business News, Anthony Keane 19 Nov 2018 Page words ASR AUD 1,265 Photo: Yes Type: News Item Size: cm² NT Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 11,279 CIRCULATION Shine of bank shares dims Northern Territory News, Darwin, Business News, David Libby Koch 19 Nov 2018 Page words ASR AUD 4,507 Photo: Yes Type: News Item Size: cm² NT Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 11,279 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

18 Warning on selfies West Australian, Perth, Your Money, Neale Prior 19 Nov 2018 Page words ASR AUD 1,964 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 219 word(s), <1 min 147,676 CIRCULATION LRBAs face hard labour under Labor West Australian, Perth, Your Money, Tracey Scotchbrook 19 Nov 2018 Page words ASR AUD 6,066 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 689 word(s), ~2 mins 147,676 CIRCULATION Employers to pay price for skimping on super Daily Mercury, Mackay QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 241 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 7,207 CIRCULATION Shine of bank shares dims Daily Mercury, Mackay QLD, General News 19 Nov 2018 Page words ASR AUD 710 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 7,207 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

19 Employers to pay price for skimping on super Queensland Times, Ipswich QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 207 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 436 word(s), ~1 min 6,256 CIRCULATION Shine of bank shares dims Queensland Times, Ipswich QLD, General News 19 Nov 2018 Page words ASR AUD 625 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 6,256 CIRCULATION Bank bosses to face the music at inquiry Geelong Advertiser, Geelong VIC, General News 19 Nov 2018 Page words ASR AUD 507 Photo: No Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 351 word(s), ~1 min 16,687 CIRCULATION Shine of bank shares dims Gladstone Observer, Gladstone QLD, General News 19 Nov 2018 Page words ASR AUD 608 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 3,301 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

20 Employers to pay price for skimping on super Gladstone Observer, Gladstone QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 209 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 436 word(s), ~1 min 3,301 CIRCULATION Bank bosses to face the music Launceston Examiner, Launceston TAS, General News 19 Nov 2018 Page words ASR AUD 1,444 Photo: Yes Type: News Item Size: cm² TAS Australia Industry Super Australia - Press ID: View original - Full text: 230 word(s), <1 min 17,631 CIRCULATION Employers to pay price for skimping on super Gold Coast Bulletin, Gold Coast QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 1,658 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 21,468 CIRCULATION Shine of bank shares dims Gold Coast Bulletin, Gold Coast QLD, General News, David Libby 19 Nov 2018 Page words ASR AUD 5,846 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 21,468 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

21 Shine of bank shares dims Sunshine Coast Daily, Maroochydore QLD, General News 19 Nov 2018 Page words ASR AUD 924 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 841 word(s), ~3 mins 10,046 CIRCULATION Shine of bank shares dims News Mail, Bundaberg QLD, General News 19 Nov 2018 Page words ASR AUD 615 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 6,176 CIRCULATION Employers to pay price for skimping on super News Mail, Bundaberg QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 209 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 436 word(s), ~1 min 6,176 CIRCULATION Employers to pay price for skimping on super Morning Bulletin, Rockhampton QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 397 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 9,376 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

22 Shine of bank shares dims Morning Bulletin, Rockhampton QLD, General News, Libby David Koch 19 Nov 2018 Page words ASR AUD 922 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 9,376 CIRCULATION Shine of bank shares dims Cairns Post, Cairns, General News, David Libby Koch 19 Nov 2018 Page words ASR AUD 4,108 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 13,896 CIRCULATION Employers to pay price for skimping on super Cairns Post, Cairns, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 1,128 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 436 word(s), ~1 min 13,896 CIRCULATION Shine of bank shares dims Townsville Bulletin, Townsville QLD, General News, David Libby Koch 19 Nov 2018 Page words ASR AUD 4,885 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 840 word(s), ~3 mins 16,484 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

23 Employers to pay price for skimping on super Townsville Bulletin, Townsville QLD, General News, Anthony Keane 19 Nov 2018 Page words ASR AUD 1,378 Photo: Yes Type: News Item Size: cm² QLD Australia Industry Super Australia - Press ID: View original - Full text: 433 word(s), ~1 min 16,484 CIRCULATION Bank bosses to face the music Border Mail, Albury-Wodonga, General News 19 Nov 2018 Page words ASR AUD 920 Photo: Yes Type: News Item Size: cm² VIC Australia Industry Super Australia - Press ID: View original - Full text: 230 word(s), <1 min 13,519 CIRCULATION Women are not on track West Australian, Perth, Your Money, Neale Prior 19 Nov 2018 Page words ASR AUD 13,762 Photo: Yes Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 859 word(s), ~3 mins 147,676 CIRCULATION Risks forced on investors West Australian, Perth, Your Money, Peter Warnes 19 Nov 2018 Page words ASR AUD 3,997 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 456 word(s), ~1 min 147,676 CIRCULATION COPYRIGHT For the internal research use of Mediaportal subscribers only. Not to be provided to any third party for any purpose without the express permission of Isentia. For further information contact copyright@isentia.com

24 Plan for the unexpected West Australian, Perth, Your Money, Rhonda Parker 19 Nov 2018 Page words ASR AUD 13,044 Photo: Yes Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 767 word(s), ~3 mins 147,676 CIRCULATION Bull detectors wanting with conflicted advice West Australian, Perth, Your Money, Neale Prior 19 Nov 2018 Page words ASR AUD 6,311 Photo: No Type: News Item Size: cm² WA Australia Industry Super Australia - Press ID: View original - Full text: 592 word(s), ~2 mins 147,676 CIRCULATION COPYRIGHT This report and its contents are for the internal research use of Mediaportal subscribers only and must not be provided to any third party by any means for any purpose without the express permission of Isentia and/or the relevant copyright owner. For more information contact copyright@isentia.com DISCLAIMER Isentia makes no representations and, to the extent permitted by law, excludes all warranties in relation to the information contained in the report and is not liable for any losses, costs or expenses, resulting from any use or misuse of the report.

25 The Australian, Australia Author: Ewin Hannan Section: General News Article type : News Item Classification : National : 94,448 Page: 5 Printed Size: cm² Region: National Market: Australia ASR: AUD 4,631 Words: 387 Item ID: Page 1 of 1 Plumber accused of $16-an-hour rip-off EXCLUSIVE EWIN HANNAN WORKPLACE EDITOR The Fair Work Ombudsman has launched a second legal action against a Victorian plumber, alleging he unlawfully paid a 23- year-old worker just $16 an hour and falsified records when caught out by the federal agency. The ombudsman has started the fresh proceedings in the Federal Circuit Court against Michael Patrick Pulis and his company, Pulis Plumbing, alleging they underpaid the young worker $3929 between July and September last year, and subsequently falsified employment records to try to hide the underpayment. In an earlier case, Mr Pulis and his company were penalised $121,500 last year for underpaying another young worker, with a Federal Circuit Court judge finding the conduct represented outrageous exploitation and was nothing short of avarice. Mr Pulis told a 20-year-old he was being hired as a second-year apprentice but never formally signed him up as an apprentice. The worker was paid $12.18 an hour, but should have received $37.08 an hour for ordinary hours and up to $74.16 an hour for overtime. The 20-year-old worked 10 to 12 hours a day but Mr Pulis told him after three months his skills and attitude were not at a second-year apprentice s standard. When the worker asked Mr Pulis when he would be paid the wages owed to him, Mr Pulis replied: Seriously, f..k off. When I m ready. In the latest case, Fair Work inspectors investigated the company again after the 23- year-old employee requested assistance. He was allegedly paid a flat hourly rate of $16.55 for working up to 40 hours a week, but should have received $21.20 an hour. The ombudsman alleges that Mr Pulis and his company provided inspectors with a falsified employer apprenticeship document and falsified time-and-wages records that purported to show the employee had been provided higher rates than was actually the case. It is further alleged the employee was underpaid his minimum hourly rates, overtime pay, allowances, leave entitlements and that superannuation was not contributed on his behalf. Fair Work Ombudsman Sandra Parker said: Any employer who fails to comply with their workplace obligations may face legal action and significant financial penalties. When deciding which matters to take to court, the Fair Work Ombudsman considers allegations involving repeat noncompliance and young workers particularly seriously. The matter is listed for a directions hearing in the Federal Circuit Court in Melbourne on December 4.

26 The Australian, Australia Author: Turi Condon Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 15,796 Words: 599 Item ID: Page 1 of 2 Companies must behave: Mirvac TURI CONDON A trust deficit had opened up between corporate Australia and the community, Mirvac Group chairman John Mulcahy told the company s annual general meeting, saying companies had to be better. The former Suncorp chief executive and Future Fund director said big business not only had a responsibility to its investors but also to the wider community and its staff, while property companies in particular had to consider the environment they affected. We have seen recently what can happen when communities lose faith in institutions that were previously pillars of trust, Mr Mulcahy told investors on Friday. He said that strategic thinking and behaviours needed to be reinforced from the top and throughout an organisation. In the past Mirvac itself had been criticised for poor practices and was named in the 2015 trade union royal commission for concealing payments to unions two years earlier. Poor behaviour lets us all down and all corporates have a responsibility to be better, Mr Mulcahy said. But being a better corporate citizen cannot be a box-ticking exercise. It is not a policy to be invented in a boardroom and then implemented overnight. His comments come as the chief executives of the four major banks begin appearing at the financial services royal commission this week. Mirvac chief executive Susan Lloyd-Hurwitz told Friday s meeting that the company would rely more heavily on earnings from its CBD towers and other passive income as the office boom rolled on and residential markets weakened. Mirvac was likely to buy new residential sites in the cooler market conditions. We will take it as an opportunity to carefully begin restocking our pipeline, Ms Lloyd-Hurwitz said. About 18 months ago, we said we believed we were at the top of the cycle, and as we had expected, we have seen the residential market return to more normalised conditions, following years of unprecedented price growth. Ms Lloyd-Hurwitz said that the contribution from Mirvac s residential business would be lower this financial year due to the timing of settlements. However, the 2020 financial year would be strong, with more than half the residential pipeline of 27,000 lots expected to have a margin of more than 25 per cent. Earnings for 2019 were skewed towards masterplanned communities, with more than $2.1bn of residential pre-sales in hand. Ms Lloyd-Hurwitz reiterated that the property cycle had changed. She said passive income and high quality assets would be key factors. Passive earnings will now accelerate from a growth rate of 1 per cent to 5 per cent per annum over next three years as office developments come on line and very strong office market conditions drive income growth, she told the meeting. The group would maintain the amount of capital for residential and office developments at around $1.7bn to $2bn. We expect to deliver around $1bn of active earnings over the next three years with excellent visibility and security, she said. The difference over the next three years will be the composition of those active earnings, with greater contribution coming from commercial development and masterplanned communities. Ms Lloyd-Hurwitz noted that its fledgling build-to-rent business had launched in July with a 258- unit complex in Sydney s Olympic Park due to be completed in the 2021 financial year. Two new directors will join the Mirvac board. UniLodge founder Jane Hewitt and former KPMG chairman and senior partner Peter Nash will become Mirvac directors before Christmas. Mirvac received a 7.6 per cent vote against its remuneration report at the meeting. The company s shares closed unchanged on Friday at $2.20.

27 The Australian, Australia Author: Turi Condon Section: Business News Article type : News Item Classification : National : 94,448 Page: 21 Printed Size: cm² Region: National Market: Australia ASR: AUD 15,796 Words: 599 Item ID: Page 2 of 2 Mirvac chairman John Mulcahy: Being a better corporate citizen cannot be a box-ticking exercise

28 The Australian, Australia Author: Turi Condon Ben Butler Section: General News Article type : News Item Classification : National : 94,448 Page: 2 Printed Size: cm² Region: National Market: Australia ASR: AUD 4,013 Words: 371 Item ID: Page 1 of 1 Community in trust deficit with business TURI CONDON BEN BUTLER Former banking boss John Mulcahy has warned corporate Australia it would need to lift its behaviour to restore community trust ahead of a potentially bruising final round of the banking royal commission, starting today. Mr Mulcahy, a former chief executive of Suncorp one of the financial institutions already battered by the royal commission and a Future Fund director said a trust deficit had opened between business and the wider community. We have seen recently what can happen when communities lose faith in institutions that were previously pillars of trust, Mr Mulcahy told investors in the property company he now chairs, Mirvac, on Friday. Poor behaviour lets us all down and all corporates have a responsibility to be better. He said big business not only had a responsibly to investors but also to the wider community and its staff, while property companies in particular had a responsibility to the environment they effected. We have seen recently what can happen when communities lose faith in institutions that were previously pillars of trust, he said. Poor behaviour lets us all down and all corporates have a responsibility to be better. But being a better corporate citizen cannot be a box-ticking exercise. It is not a policy to be invented in a boardroom and then implemented overnight, said Mr Mulcahy, who became chairman of the $8.2 billion developer and fund manager in His comments came ahead of the final fortnight of hearings to be held by royal commissioner Kenneth Hayne, which will hear from bank chief executives and chairmen. The hearings resume this morning in Sydney for a week of grilling executives from the Commonwealth Bank, Westpac and Macquarie Group. It is understood CBA chief executive Matt Comyn will be the first witness in the stand, with chairman Catherine Livingstone tipped to appear as early as today or tomorrow. NAB chairman and former Treasury secretary Ken Henry is expected to give evidence when the commission travels to Melbourne next week. It will be the first time Macquarie has appeared before the commission, with the so-called Millionaire s Factory so far avoiding the inquiry s hotseat despite a string of scandals including financial planning ripoffs and its alleged involvement in a German tax rort.

29 Australian Financial Review, Australia Author: Nick Lenaghan Section: Property Article type : News Item Classification : National : 44,635 Page: 31 Printed Size: cm² Region: National Market: Australia ASR: AUD 2,832 Words: 318 Item ID: Page 1 of 1 AustralianSuper taps Towning to revive global returns Nick Lenaghan Property veteran Bevan Towning has been recruited to steer Australian- Super s $11 billion property book towards better returns as the super fund giant steps up its exposure to global real estate. With a string of senior executive roles to his belt, the well-regarded Mr Towning steps into the role left vacant by Jack McGougan, who left on bitter terms earlier this year and is now suing AustralianSuper. Mr Towning s most immediate task will be to lift returns from the real estate allocation which have consistently fallen below the benchmarks over the last 10 years, judged by the super fund s property option, which is almost 97 per cent invested in direct property. The $140 billion super fund invests into major malls and office towers both at home and abroad, including landmark assets such as Honolulu s Ala Moana Centre, The Centre: MK mall in Milton Keynes, northwest of London and Kings Cross Estate, a mixed-use development in London. The largest single portion of its property investment is directed by AustralianSuper s own in-house team, although more than half of the property allocation is managed externally by platforms including QIC and ISPT. AustralianSuper has been diversifying into property lending, both commercial and residential. Those investments sit within the broader mid risk allocation, which includes property Mr Towning s province along with infrastructure and credit. Recent examples of the debt strategy include a 280 million development loan, worth around $510 million, to One Crown Place in London in a partnership with TH Real Estate. AustralianSuper has also supplied construction finance for a $400 million residential project at Macquarie Park in Sydney. Meanwhile, the super fund giant is defending a multimillion-dollar lawsuit brought by Mr McGougan who claims he was forced out because he complained the fund had conflicts of interest in investing in union-linked property trust ISPT. In its defence, AustralianSuper has detailed how relationships turned toxic at the top after a restructure.

30 Australian Financial Review, Australia Author: James Eyers Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 16 Printed Size: cm² Region: National Market: Australia ASR: AUD 5,765 Words: 633 Item ID: Page 1 of 1 Litigation wave would hamper change Culture James Eyers With the banks braced for an application of the legal blowtorch over the next fortnight, one of the nation s leading banking lawyers says court action against bank wrongdoing could be counterproductive and actually hamper attempts to improve culture. One of the Hayne s inquiry s core observations in the interim report was that regulators need to conduct more litigation against banks to enforce the law. It criticised too many enforceable undertakings and other agreed settlements. But I strongly doubt that a relentless wave of litigation, taking to court all breaches great and small, will be of benefit to anyone, said Tony Damian, a partner of Herbert Smith Freehills and global co-chairman of the firm s banking sector group. A wave of regulatory litigation seems liable to divert the attention and resources of banks to defending past conduct rather than preventing future misconduct. The comments come after the federal government last week pledged another $51.5 million in funding for criminal and civil prosecutions against financial institutions. The Australian Securities and Investments Commission used its Herbert Smith Freehills partner Tony Damian doubts that a relentless wave of litigation... will be of benefit to anyone. submission to the interim report to call for more government funding to take banks to court. Bank investors are nervous about the prospect of royal commissiontriggered class actions causing the banks to pay potentially billions in additional compensation. The Australian Prudential Regulation Authority is also under pressure to take more court actions on the of the Banking Executive Accountability Regime. It said last week it was conducting a review of its own enforcement strategy. It is timely to examine whether APRA s traditional approach prioritising prevention and rectification can be augmented by greater enforcement activity, APRA deputy chairman John Lonsdale, who will lead the review, said last week. But Mr Damian said it had been the acute public scrutiny of the royal commission, and not the threat of lawsuits, that had created the momentum for change in the banks. He said there would be times that court enforcement was appropriate but a regulatory culture of litigation will in turn shift bank culture to strict legal compliance in an adversarial context and the joy of that will be shortlived. In the near term, people will be able to point to a significant increase in matters taken to court. But courts are expensive, unpredictable and will ultimately divert resources and attention from the task at hand, which is cultural change, he said. Herbert Smith Freehills will release its 2018 Global Bank Review on Tuesday. Mr Damian s view will be supported in the major banks. Westpac Banking Corp said in its submission to the interim report that given the complexity and number of financial services laws and regulations and differences in the responsiveness of licensees, it would be impractical and inefficient for litigation to be commenced on every occasion where a financial services licensee may have contravened some aspect of the law. But the interim report said it was wrong for ASIC to adopt a starting point when considering breaches of laws of resolving a matter by agreement. When contravening conduct comes to its attention, the regulator must always ask whether it can make a case that there has been a breach and, if it can, then ask why it would not be in the public interest to bring proceedings to penalise the breach. Laws are to be obeyed. Penalties are prescribed for failure to obey the law because society expects and requires obedience to the law, the report said. Mr Damian said: At the end of the day it is up to the banks to own their culture. In my view, they are doing that. Anyone who suggests that banks are not taking these questions very seriously is in my opinion wrong.

31 Australian Financial Review, Australia Author: James Frost Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 17 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,929 Words: 554 Item ID: Page 1 of 2 ACCC gave CBA a pass on cartel breach Regulators James Frost The Australian Competition and Consumer Commission gave Commonwealth Bank a pass over a breach of cartel laws after learning it was selling credit products provided by a rival big four bank. The breach was self-reported by CBA on August 17, 2017 after it mopped up the remaining stake in mortgage broking giant Aussie Home Loans. The Australian Financial Review understands the breach involved a white-labelling arrangement that saw Aussie sell ANZ credit cards that was still in place following CBA s acquisition of the outstanding 20 per cent stake in the mortgage broker. The effect of the purchase would make CBA a party to a contract, arrangement or understanding, in breach of the Competition and Consumer Act Cartel Provisions Section 45AD. Under section 45AC, the definition of party is extended to include related companies and subsidiaries. The maximum penalty for corporations is the greater of $10 million or 10 per cent of annual turnover in the preceding 12 months. For individuals it is 10 years jail. CBA and Aussie have since unwound the arrangement and Aussie no longer offers the product. The breach was revealed in Aussie s original submission to the royal commission. A spokesman for Commonwealth Bank said it was a technical breach and it was resolved following discussions with the regulator. A spokesman for the ACCC said after investigating the matter it decided not to pursue it any further because it did not believe it was warranted. The ACCC examined the matter, but decided to take no further action, as the issue was a technical breach. The ACCC aims to focus its resources on matters that involve serious harm to the wider economy, the spokesman said. Last week, ACCC chairman Rod Sims told Fairfax Media the role of the ACCC was to call out misconduct and bad behaviour from the banks when it saw it. There are a lot of corporate people who want regulators to be seen and not heard. That s not our approach and that s never been our approach, Mr Sims said. The ACCC has not appeared before the Hayne commission nor is it scheduled to appear over the final two weeks of hearings starting on Monday. Other corporate regulators, such as the Australian Securities and Investments Commission and the Australian Prudential Regulation Authority, were slammed by Commissioner Kenneth Hayne in his interim report, for failing to punish banks for breaking the law or applying manifestly inadequate penalties. When misconduct was revealed, it either went unpunished or the consequences did not meet the seriousness of what had been done, Commissioner Hayne said. The Productivity Commission s review of competition in the Australian financial system highlighted the need for a competition champion and described the ACCC as a natural fit for the role. The ACCC responded by supporting the proposal, saying it was well placed to pick up the mantle. The ACCC established the Financial Services Unit in 2017 with funding of $14.4 million. As of February this year it had 12 permanent staff. Earlier this year the ACCC announced it wouldpursue criminalcharges against a number of ANZ, Deutsche Bank and Citi executives following a botched capital raising in Features Bank bosses in the dock p36-37

32 Australian Financial Review, Australia Author: James Frost Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 17 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,929 Words: 554 Item ID: Page 2 of 2 ACCC chair Rod Sims said the role of the regulator was to call out instances of misconduct it saw. PHOTO: ALEX ELLINGHAUSEN

33 Adelaide Advertiser, Adelaide Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 112,097 Page: 38 Printed Size: cm² Region: SA Market: Australia ASR: AUD 12,138 Words: 840 Item ID: Page 1 of 2 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good

34 Adelaide Advertiser, Adelaide Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 112,097 Page: 38 Printed Size: cm² Region: SA Market: Australia ASR: AUD 12,138 Words: 840 Item ID: Page 2 of 2 substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

35 Adelaide Advertiser, Adelaide Author: Anthony Keane Section: Business News Article type : News Item Classification : Capital City Daily : 112,097 Page: 38 Printed Size: cm² Region: SA Market: Australia ASR: AUD 3,332 Words: 433 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. Martin Fahy.

36 Daily Telegraph, Sydney Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 232,067 Page: 24 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 37,802 Words: 840 Item ID: Page 1 of 3 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following:

37 Daily Telegraph, Sydney Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 232,067 Page: 24 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 37,802 Words: 840 Item ID: Page 2 of 3 Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

38 Daily Telegraph, Sydney Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 232,067 Page: 24 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 37,802 Words: 840 Item ID: Page 3 of 3

39 Daily Telegraph, Sydney Author: Anthony Keane Section: Business News Article type : News Item Classification : Capital City Daily : 232,067 Page: 24 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 16,302 Words: 433 Item ID: Page 1 of 1 David & Libby Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

40 Australian Financial Review, Australia Author: James Eyers Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 16 Printed Size: cm² Region: National Market: Australia ASR: AUD 9,891 Words: 744 Item ID: Page 1 of 2 Banks big sell on pay fails to filter down Remuneration James Eyers More than half of the bank staff surveyed by their union say changes to remuneration policies have failed to create a more customer-centric workplace, as the Hayne inquiry prepares to pressure bank CEOs and chairmen over how pay schemes have caused widespread misconduct. The Finance Sector Union last week wrote to the CEOs of the big four banks and AMP providing the results of its workplace culture survey and requested meetings in the new year. The union plans to provide the banks with specific feed from their staff, part of a broader campaign to implement the ultimate recommendations of the inquiry across the industry. The survey of 7000 bank staff with more than 5000 respondents coming from the majors in mostly customerfacing retail and business banking roles suggests that while CEOs and chairman are talking about the importance of orienting service around customers, this may not be filtering down to middle management and branches. More than three-quarters of respondents say their performance is now being assessed against a range of factors and more than half say their performance objectives are to prioritise the best interests of the customer. However, half say their role still requires participating in sales campaigns related to the sales of specific products. There is still pressure to sell and hit revenue targets; they are just hidden behind other targets in the balanced scorecards, said national secretary of the FSU, Julia Angrisano. The tactics have just been rebranded. Leaderboards continue to be used across the industry. The pressure to sell remains really high in the front office. The interim report of the royal commission was critical of balanced scorecards for concealing sales metrics behind targets the banks described as being about servicing customers. The report also flagged that the changes to banker remuneration recommended by Stephen Sedgwick which have reduced the impact of sales targets for front-line staff might need to be pushed higher up into middle management. If customer-facing staff should not be paid incentives, why should their managers, or those who manage the managers? the report asked. Why will altering the remuneration of frontline staff affect a change in culture if more senior employees are rewarded for sales or revenue and profit? Banking sources said a significant amount of the information provided to the commission for this round of hearings related to remuneration policies. The bank CEOs and chairmen may also be asked over this fortnight to justify why variable remuneration needs to be paid at all. The unstated premise for so much of the debate about remuneration of both bank staff and intermediaries that staff and intermediaries will not do their job properly and to the best of their ability without incentive payments must be challenged, Commissioner Kenneth Hayne wrote. With any remuneration reforms likely to be required across the industry, the FSU is pushing for more industrial regulation of pay, and has called for law reform to enable collective bargaining on behalf of bank employees. It also suggests any industry-wide framework should be overseen by an independent arbiter such as the Fair Work Commission. The FSU has also warned any reduction in variable pay in the wake of the royal commission should not be used by the banks to earn windfall profits. It says that some high-performing branch staff have seen take-home pay reduced by up to 20 per cent as a result of the Sedgwick changes. The union is aware of a number of recent instances where the employer has simply, unilaterally, eliminated the variable component and made no adjustment to base pay. In such cases the employer continues to recover the same revenue from the employee s labour, and makes a windfall profit, its submission to the interim report said. It described this as a perverse and unfair outcome. The FSU s workplace culture survey also shows growing dissatisfaction with use of the net promoter score (NPS) to measure customer satisfaction: more than half of respondents said it was not a fair measure of staff contribution. The royal commission interim report said the NPS does not measure whether a customer has been serviced according to their best interests, or indeed their needs and it does not measure whether the service they have received is legally compliant. The tactics have just been rebranded. Leaderboards continue to be used across the industry. Julia Angrisano, FSU

41 Australian Financial Review, Australia Author: James Eyers Section: Companies and Markets Article type : News Item Classification : National : 44,635 Page: 16 Printed Size: cm² Region: National Market: Australia ASR: AUD 9,891 Words: 744 Item ID: Page 2 of 2 The Finance Sector Union s workplace culture survey of bank staff found sales pressures are still intense. PHOTO: TANYA LAKE

42 Australian Financial Review, Australia Author: James Frost Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,848 Words: 1013 Item ID: Page 1 of 2 CBA chiefs enter world of Hayne James Frost Commonwealth Bank of Australia chief executive Matt Comyn and chairman Catherine Livingstone will be called to explain the bank s stubborn defence of flawed processes, faulty products, banker bonuses and clumsy cover-ups when they front the Hayne commission this morning. The two representatives of Australia s biggest bank, valued at $120 billion, will be putting everything on the line as they are questioned on issues ranging from the charging of dead customers and lying to customers, to the bank s risk systems and its distain for the regulators. The Australian Financial Review understands Mr Comyn and Ms Livingstone spent much of yesterday in conference calls with internal legal counsel and external counsel from law firm Clayton Utz. The last-minute preparations represent the final stage of the bank s attempts to manage the royal commission, known as Project Buckingham, which has been ramped up following the bank s AGM and with the appearances anticipated since the commission was announced 12 months ago. The bank has been on the front foot in efforts to address failures after it was hit with a rapid succession of scandals in its financial planning and life insurance businesses, culminating in a $700 million settlement for failing to Continued p8 News Bonuses boost risk: report p8 Companies Big sell on pay failure p16 ACCC gave CBA a pass on breach p17 Features Bosses in the dock p36 From page 1 CBA chiefs enter world of Hayne comply with anti-money-laundering and terrorism-financing laws. Among the key areas of inquiry that Mr Comyn and Ms Livingstone are likely to face are the bank s reliance on a controversial benchmark for assessment of home loan customers known as the Household Expenditure Measure (HEM), the grandfathering of banned commissions, junk insurance products and executive pay. Ms Livingstone torched the bonuses of the bank s entire executive team and slashed director fees by 20 per cent in the aftermath of the AUSTRAC debacle in August 2017, introducing the concept of collective accountability for the bank and its executives. The bank s executives have had their pay reduced by $100 million in total. The move was supported by shareholders and copied by the other banks, including ANZ and National Australia Bank, over the past two weeks. Ms Livingstone, who oversaw the exit of former CEO Ian Narev and the promotion of Matt Comyn on a package 17 per cent lower than his predecessor, may be asked why she did not go even further. CBA has moved on a number of issues explored by the commission, including removing controversial products from sale and promising to rebate grandfathered commissioners to customers. Mr Comyn, a 20-year veteran who previously ran CBA s retail banking powerhouse, will be personally on notice to explain the bank s involvement in a number of issues, including the reluctance to move away from commission structures that produce poor outcomes for home owners, questionable engagements with the regulator and attempts to spin the closure of a line of insurance products. CBA announced the closure of its Credit Card Plus and Personal Loan Protection products just one week before the hearings began on March 13. During the March hearings, an from Mr Comyn shown as evidence contained the instruction I want it to be very much tied to the AIA acquisition, referring to the $3.8 billion sale of its troubled life insurance business. Mr Comyn is also expected to be called upon to discuss the bank s interactions with the corporate and prudential regulator as well as his own. During hearings in August, it was revealed Mr Comyn attempted to reach ASIC deputy chairman Peter Kell with the intention of talking the regulator out of a sanction after CBA was caught selling superannuation products under the auspices of general advice. Evidence was shown that although the bank was expecting to be hit with an enforceable undertaking for the breaches, Mr Comyn continued to advance the idea of a lesser penalty, such as a press release saying: I think we should keep trying. The bank has also rejected a call to ban these types of insurance in its response to Commissioner Hayne s interim report, saying consumer credit insurance is not, by its nature, a poor value proposition for customers. It also chose to the use of the HEM, which has been criticised for underestimating borrower expenses, saying its use was appropriate and compliant. The bank pushed on additional obligations for mortgage brokers and said no additional duties for third-party referrers known as introducers were needed. During the first round of hearings it was revealed that the bank was aware the pay structures for mortgage brokers, which consisted of a large upfront and smaller trailling commissions, were leading to poor outcomes for borrowers but did not want to be disadvantaged by being the first mover. The mortgage broking industry is under attack after the commission revealed widespread instances of misconduct from brokers in the pursuit of commissions, with some expecting Commissioner Hayne to make brokers party to a best interests duty and recommend a radical restructure of the way they are paid. CBA supports an industry-wide transition away from grandfathered commissions and has moved to rebate superannuation andinvestment product customers from January The bank says it will affect 50,000 customers and save them $20 million each year. The commission is likely to ask Mr Comyn why the bank is waiting so long, given the reforms were introduced in Nor is it likely to be persuaded by an answer that pointed to the complexity of the problem or the systems involved. The bank was described by counsel assisting as a gold medallist in the charging of fees for no service scandal that has seen the banks pledge to repay customers $1 billion and contributed to the resignations of AMP s CEO, its chair-

43 Australian Financial Review, Australia Author: James Frost Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 7,848 Words: 1013 Item ID: Page 2 of 2 man and multiple bank executives. The appearances of Mr Comyn and Ms Livingstone will be closely watched by rival bank bosses and regulators with Westpac CEO Brian Hartzer and Macquarie CEO Nicholas Moore to follow. The following week will see ANZ CEO Shayne Elliott, NAB CEO Andrew Thorburn, NAB chairman Ken Henry and Bendigo Bank chairman Robert Johanson appear. ASIC chairman James Shipton will appear during the first week in Sydney and APRA counterpart Wayne Byres will appear in Melbourne the week after. Commonwealth Bank s Catherine Livingstone and Matt Comyn.

44 Australian Financial Review, Australia Author: Duncan Hughes Section: General News Article type : News Item Classification : National : 44,635 Page: 8 Printed Size: cm² Region: National Market: Australia ASR: AUD 6,735 Words: 601 Item ID: Page 1 of 2 Bank bonuses boost risk, not profits Duncan Hughes Bonuses for banking and financial service employees increase risk for shareholders and consumers without a commensurate gain inproductivity, analysis by Macquarie University shows. However, recent attempts to curb a rapidly growing bonus and risk-taking culture copy reforms rolled out in the City of London that made the situation worse, the analysis finds. Bonuses encourage poor behaviour amongst financial professionals, Elizabeth Sheedy, professor of finance at Macquarie University s applied finance centre and a former investment banker, said. They encourage crossing the line of acceptable behaviour. This really matters because the lives of employees and customers have been ruined because of these policies. The former derivatives adviser for Macquarie Bank and Westpac Group said research reveals employees work just as hard when paid a flat salary as when receiving a cash or share bonus. This research debunks the sacred cow that there has to be incentives or employees will not work hard, she said. The role of generous bonuses paid to bank employees in improving output, profits and shareholder and customer risk is expected to be a major issue this week at the Hayne royal commission. It is expected senior managers will be asked to identify any potential conflicts arising from profit generation and compliance. NAB, which declined to emulate competitors by increasing its standard variable interest rate, has also rejigged executive pay, resulting in big pay cuts for chief executive Andrew Thorburn and his senior executives. Other banks and financial services are expected to come under pressure to list to shareholders and customers the economic, financial, cultural and behavioural benefits of topping up salaries with bonuses. The study was jointly funded by Deloitte Australia and the Insurance Council of Australia and assisted by The Australia and New Zealand Institute of Insurance and Finance and Financial Services Institute of Australia. Macquarie put bank and financial company volunteers ranging from directors to branch employees and financial advisers in a simulated office cubical to mimic their response up to 60 financial transactions over 20 minutes. The employees were told their bonuses were linked to the profitability of their deals and only 20 per cent of transactions would be audited, which increased the likelihood of avoiding detection for breaking rules. Compliance by employees who were paid bonuses was 25 per cent worse than those on fixed remuneration. The report also takes aim at the balanced score card approach to employee incentives, a key recommendation of last year s Sedgwick review into retail banking remuneration. Eligibility to receive any variable reward payment is based on an overall assessment against a range of factors that reflect the breadth of the responsibilities of each role, ranging from compliance to customer satisfaction. Balanced scorecards include a range of measures tailored to each role. It was introduced despite the City of London s Financial Conduct Authority having detected compliance rates are worse using the system. It is found to be too influenced by managerial bias, Professor Sheedy said. Managers tended to turn a blind eye to the excesses of top performing rain makers because they were successful and profitable, she said. In addition, non-compliance often takes a long time to emerge, which means it is not an effective measure of performance in the short term. Even if managers hearts are in the right place, it can still end up with artificial outcomes, she said. Financial Services p16-17 Features Bank bosses in the dock p36-37 Key points Managers turned a blind eye to the excesses of top performing rain makers. Compliance by workers on bonuses was worse than those on fixed remuneration.

45 Australian Financial Review, Australia Author: Duncan Hughes Section: General News Article type : News Item Classification : National : 44,635 Page: 8 Printed Size: cm² Region: National Market: Australia ASR: AUD 6,735 Words: 601 Item ID: Page 2 of 2 Bonuses in the banking industry have come under further scrutiny in a study undertaken by Macquarie University. PHOTO: PETER BRAIG

46 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 36 Printed Size: cm² Region: National Market: Australia ASR: AUD 27,205 Words: 2335 Item ID: Page 1 of 4 BANK BOSSES IN THE DOCK Royal commission Here s are some of the key issues that are likely to be explored over the next two weeks, writes James Eyers. Today is the 60th day of hearings at the Hayne commission and the next fortnight the culmination of the year of reckoning for the major banks. Over the next 10 days, the banks top brass and their regulators will face a barrage of questions from senior counsel assisting and royal commissioner Kenneth Hayne more intense than typical inquiries from politicians, analysts, investors or journalists. Not surprisingly, the banks are nervous. This will be a very bright spotlight. As the hearings this year made clear, misconduct wasn t driven by a few bad apples, as banks previously wanted the public believe, but by more systemic issues including greed and the pursuit of profit, as Commissioner Hayne described it in the interim report. Now the inquiry will turn its attention to the culture, governance, remuneration and risk management practices that created the environment for the various scandals to occur. Here s a selection of some of the key issues that are likely to be explored over the next two weeks. Strap yourself in. Banker pay One of the most stark observations in the interim report appeared in the opening paragraphs of the chapter on the causes of misconduct: All the conduct identified and criticised in this report was conduct that provided a financial benefit to the individuals and entities concerned. The industry s own efforts reducing sales targets for branch staff was said to be insufficient, and the interim report torpedoed the use of balanced scorecards to assess staff. It called out most of the non-financial AFRGA metrics used in the scorecards as essentially being proxies for sales targets. Using ANZ Bank s A-Z review as an example, it said a needs-based conversation with customers was really an opportunity to sell products. The banks already understand remuneration practices require big change in ANZ acknowledges the observations in the interim report regarding its balanced scorecard for branch staff and the risk that customer key result areas may act to conceal financial metrics, the bank admitted in its submission. It s also clear Commissioner Hayne is considering extending limitations on incentive-based pay for product sales further up the management chain. Eliminating incentive-based payments for front-line staff will not necessarily affect the ways in which they are managed if their managers are rewarded by reference to sales or revenue and profit, he observed. Over the next few weeks, there should be plenty of discussion about how to manage conflicts of interest when paying intermediaries such as mortgage brokers. They may also be discussion about whether variable remuneration has a role to play at all. The banks think it does and so does APRA. But Commissioner Hayne wants to challenge the premise that bankers need to be paid a bonus to do their job properly. He s also suggested the flat share of a variable pay pool that moves with overall bank performance could be an alternative model. Whatever changes are ultimately recommended, the commissioner will be mindful of adverse consequences. For example, the Finance Sector Union has warned reducing variable should not result in staff taking home less pay because that would deliver a windfall profit to the banks. Systems and processes As the commissioner made clear from outset of this inquiry, he wants it to not only work out what happened and why, but also to try to prevent the misconduct occurring again. And so the adequacy of systems and processes have been in the spotlight all year. Now it s time to hear from those responsible for them whether improvements have gone far enough. Commonwealth Bank s systems seemed especially error-prone, struggling at times to calculate interest rates or identifying overcharging, as various case studies revealed. With CBA chair Catherine Livingstone and CEO Matt Comyn facing the music from Monday morning, the inquiry will also want to know about how its systems for monitoring risk culture are being improved. The interim report also called for bank staff to become more professional and ethical. Systems, processes, procedures, bureaucracy, automation and centralisation have limited the ability of lower-level bank staff to make independent decisions on behalf of customers. As the commissioner observed in the interim report: The more complicated the law, the easier it is for compliance to be seen as asking Can I do this? and answering that question by ticking boxes instead of asking Should I do this? What is the right thing to do? And there is every reason to think that the conduct examined in this report has occurred when the only question asked is: Can I? He isn t inclined to impose more regulation on banks. But the quid pro quo might be the need for staff to be empowered with discretion to act in the way they think is right, rather than in accordance with a procedure that misses the nuance of customer service. Regulator adequacy The banks defended their regulators in their submissions to the interim report which called out timid enforcement of laws, especially by the Australian Securities and Investments Commission. Chastising ASIC for its inclination towards negotiated settlements, Commissioner Hayne said: When contravening conduct comes to its attention, the regulator must always ask whether it can make a case that there has been a breach and, if it can, then ask why it would not be in the public interest to bring proceedings to penalise the breach. Laws are to be obeyed. Penalties are prescribed for failure to obey the law because society expects and requires obedience to the law. Over the coming weeks, he might chose to explore how the banks will respond to a prolonged period of more aggressive regulation and litigation. ASIC wants more funding for court actions and is reviewing its enforcement policies. The Australian Prudential Regulation Authority said last week it is also formally reviewing its approach. But while banks and regulators are braced for more legal fights, it seems customers will be spared. The Australian Labor Party said in its submission to the interim report many believe banks used legal processes ruthlessly to obtain outcomes. The CEOs have already committed to the parliament to not exploit their legal power over vulnerable customers. The interim report also laid bare Commissioner Hayne s dim view of industry selfregulation. He questioned the efficacy of the Code of Banking Practice, given it was written by the banks. He said it wasn t being

47 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 36 Printed Size: cm² Region: National Market: Australia ASR: AUD 27,205 Words: 2335 Item ID: Page 2 of 4 enforced strongly enough. The CEOs may be asked to explain the remit of the revised code, which provides customers with their main force of redress against banks. But the banks have warned in their submissions that if the code is made into enforceable law as the commissioner suggested it might be this could make them more legalistic and defensive. Commissioner Hayne may want to test that this week. Advisers, brokers and introducers Many customers engage with banks via third parties and the interim report raised many questions about the confused and often conflicted role played by networks of advisers, brokers and introducers. Who they owe duties to can be unclear and confused, while commission-based payments create conflicts of interest. Commissioner Hayne has asked whether it might be desirable to make those who are not employees of a bank, but who deal with bank customers, act in the best interests of those customers. The interim report questioned whether National Australia Bank s introducer program was consistent with responsible lending obligations. Much of the most abhorrent conduct uncovered came at the hands of advisers, especially financial advisers. Charging fees for no service was revealed as an endemic problem. The root cause for what happened was greed; the greed of both licensees and advisers, the interim report said. The CEOs will now have a chance to explain how all of the networks that haul business into the banks should be controlled and paid for. Brokers can enhance competition and improve customer service. But Commissioner Hayne will want to ensure intermediaries don t put their own interests ahead of customers. One of the messages from the CEOs may be that reducing commissions will result in the first mover losing out in the market place. Any solution will require collective rather than unilateral action. Among the many banking acronyms introduced into the popular lexicon by this inquiry has been HEM: Household Expenditure Measure. The interim report asked a lot of questions about whether banks are properly assessing borrower expenditure, and also income, before lending. Additional tightening here could further restrict the amount of credit available. The banks argue a benchmark like HEM is still relevant, to provide a stop or floor to estimates from customers. If the CEOs are asked about lending obligations over this fortnight, they may call out the significant technological changes currently underway that will improve access to data. One of those is open banking. Open banking initiatives will provide significant opportunities for efficiently accessing transaction data of prospective borrowers where necessary and for the development and evolution of systems to analyse transaction data, Macquarie Group told the inquiry. It is one of several policies in train across the banking sector designed to improve customer experience. A key challenge for the royal commission over the next two weeks will be working out what existing policies need to be given more time to be bedded down, and in which areas new reforms are required. AFR Open banking initiatives will provide significant opportunities for efficiently accessing transaction data. Macquarie Group Responsible lending Falling house prices in Sydney and Melbourne creates a dramatic drop to these hearings. Commissioner Hayne is on notice his ultimate recommendations have the potential to influence the stability of the economy. Bank investors are watching closely.

48 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 36 Printed Size: cm² Region: National Market: Australia ASR: AUD 27,205 Words: 2335 Item ID: Page 3 of 4 D-Day CBA Matt Comyn, CEO ANZ Shayne Elliott, CEO Should the Banking Code of Practice be recognised and applied by legislation? If given legislative effect, the 2019 code would require considerable revision to better clarify the nature and extent of a bank s obligations. What have been the causes of the misconduct? The financial services industry developed a culture that became overly focused on revenue and sales. Does the test for responsible lending need to change? CBA does not believe that the responsible lending test needs to change. Increasing lending obligations may have the unintended consequence that large, highly regulated institutions retreat from higher-risk segments of the market, which may disproportionately affect low-income earners and vulnerable customer groups. How should mortgage brokers be remunerated? ANZ supports the continued use of trail commissions for mortgage brokers. Trail commissions promote better customer outcomes by giving brokers an incentive to recommend loans that will be suitable to the customer for the life of the loan, and assist the industry to attract and retain quality brokers. Should any bank employee dealing with a customer be rewarded for selling a product of the bank? CBA acknowledges that there can be inherent risks in variable remuneration, including poor conduct, and in recent years has implemented significant changes to mitigate these risks. Should senior executives be paid variable remuneration? If calibrated correctly, ANZ considers that variable reward (in conjunction with other forms of recognition and incentives such as promotion, and development opportunities) can be a powerful tool to support the achievement of good outcomes for customers, regulators, staff and shareholders. Answers provided by the banks. All the conduct identified and criticised in this report was conduct that provided a financial benefit to the individuals and entities concerned. Commissioner Hayne s interim report

49 Australian Financial Review, Australia Author: James Eyers Section: General News Article type : News Item Classification : National : 44,635 Page: 36 Printed Size: cm² Region: National Market: Australia ASR: AUD 27,205 Words: 2335 Item ID: Page 4 of 4 NAB Andrew Thornburn, CEO Macquarie Nicholas Moore, CEO Westpac Brian Hartzer, CEO Should the HEM continue to be used as a benchmark for borrowers living expenses? The Household Expenditure Measure (HEM) should continue to be used as a benchmark for borrowers living expenses. the HEM serves as a safety net by applying a minimum acceptable level of expenses. What duties does an intermediary owe to a borrower? In Macquarie s experience, honest, professional and competent intermediaries (including mortgage brokers and dealers) bring real and significant advantages to consumers in terms of convenience, and to the market and consumers in terms of competition. Do the events that have happened invite consideration of whether structural changes should be made? Westpac does not believe that the matters arise from the structural features of a business that provides both financial advice and products. Any perceived or actual conflicts can be addressed by appropriate controls. Are introducer programs compatible with responsible lending obligations? NAB accepts there were previously weaknesses in our Introducer Program and has taken steps to address those weaknesses by making significant changes [the] program in its current form is compatible with responsible lending obligations. What steps, consistent with responsible lending obligations, should a lender take to verify a borrower's expenses? Any change to responsible lending obligations that increases the extent to which lenders must have regard to bank statements should be synchronised with the implementation of open banking and the development and evolution of systems to analyse transaction data made accessible by open banking. Should financial services laws be simplified? The proliferation of laws, their complexity and sometimes their ambiguity can cause difficulties in designing and implementing systems and processes that manage conduct risk and ensure compliance, and can also cause difficulties for regulators in seeking to enforce those laws. What are banks doing to meet the danger of conduct risk? NAB is acutely conscious that conduct risk is an area of risk requiring increased attention, further work and improvement. Are ASIC s enforcement practices satisfactory? It is Macquarie's experience that an enforceable undertaking can achieve effective regulatory outcomes and facilitate change more quickly and broadly within its business than may be the case had a litigation route been pursued first or in the alternative. Should any part of the remuneration of financial advisers be dependent on value or volume of sales? Westpac considers that it is appropriate for some part of the remuneration of a financial adviser to be influenced by the revenue the adviser generates, if there are appropriate controls in place and correct incentives are created. SOURCE: ROYAL COMMISSION SUBMISSIONS

50 Courier Mail, Brisbane Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 135,007 Page: 32 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 14,103 Words: 840 Item ID: Page 1 of 2 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good

51 Courier Mail, Brisbane Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 135,007 Page: 32 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 14,103 Words: 840 Item ID: Page 2 of 2 substitute for the Big Four in an investment portfolio that needs higher growth options among diversified A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

52 Age, Melbourne Author: Jessica Irvine Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 125,930 Words: 2658 Item ID: Page 1 of 5 S P E C I A L R E P O R T THE DEMOCRACY In the first of a five-part series, The Future Fix, Jessica Irvine examines how knee-jerk politics is fuelling mistrust in our political system but also sparking a search for fresh solutions. Peter Shergold is worried. During the final years of the Howard government, Shergold sat at the apex of Australia s federal bureaucracy as secretary of the Department of Prime Minister and Cabinet. Recently, as president of the Institute of Public Administration Australia (IPAA), he surveyed more than 800 IPAA conference attendees, mostly current and former public servants. I was shocked by the results, Shergold said recently. Australia s public servants were suffering a crisis of confidence. Just two in five felt they delivered projects well and made effective use of taxpayers money. Almost half said their institutions had become more political. The majority said ministerial advisers played too great a role in governance (60 per cent), and 70 per cent thought the same of consultants. Most worryingly, just 30 per cent thought the public service remained frank and fearless. Such gloom comes at the worst possible time, says Shergold. The foundations of liberal democracy appear to be increasingly fragile. Populist responses to complex public policy conundrums are becoming attractive to disillusioned voters in search of simple answers. Shergold says there is a rising tribalisation of Australian politics and culture. In this post-truth world, the value of a skilled public administration, trained in looking at all sides of a political proposition in a considered and thoughtful manner, is no longer regarded as a civic virtue. He is not alone in expressing concern about the health of Australia s democratic process: the system whereby elected officials, assisted by frank and fearless public servants, draft, explain and implement public policies that advance the interests of society. Losing the democratic faith Public faith in democracy in Australia is in decline, according to a range of recent surveys. Slightly less than half of Australians aged under 45 agreed that democracy is preferable to any other kind of government, in a Lowy Institute poll this year. And satisfaction with democracy is at its lowest ebb since the aftermath of the shock dismissal of the Whitlam government in 1975, NATAGE A008 according to the Australian Election Study, run out of the Australian National University. There is a combination of factors leading to the decline in democratic satisfaction, says Dr Sarah Cameron, a political scientist at the University of Sydney. Voters have largely disapproved of the changes of prime minister that have taken place in between elections over the past decade, under both Labor and Liberal governments. There s a perception that the government is run for big interests, and that politicians are looking after themselves rather than governing on behalf of the people they are elected to represent. But while political dysfunction is playing a BLUES role, deeper economic reasons also l seem t to b be d driving i the results, says Cameron. In recent elections, voters have become increasingly pessimistic about the state of the economy. In 2016, just 10 per cent of voters believed economic conditions in Australia had improved over the past year down from 43 per cent in These negative attitudes about the economy are related to dissatisfaction with democracy. A democratic disconnect The envy of the world, as it enters its 27th year of continuous economic growth, the Australian economy recently earned a place on the cover of The Economist magazine for the first time, in an edition titled Aussie rules: What the world can learn from Australia. The special feature extolled Australia s economic success while expressing only mild perplexion at the revolving door of prime ministers Down Under. But Aussies are not buying it. Just 5 per cent of Australians feel they have personally gained a lot from our record-busting economic run, according to a survey in April by the Committee for Economic Development of Australia (CEDA). In contrast, 74 per cent believe large corporations have gained a lot. Amid the scandals unearthed by the banking royal commission, Australians also made international headlines last month when they erupted with fury over the placement of corporate advertising across the Sydney Opera House. The head of CEDA, Melinda

53 Age, Melbourne Author: Jessica Irvine Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 125,930 Words: 2658 Item ID: Page 2 of 5 Cilento, says Australia is suffering a democratic disconnect. No matter how impressive we feel our track record of growth has been, very few people feel that they personally have gained much. Yet this is unfounded, says Cilento. While areas of entrenched disadvantage remain, particularly in Indigenous communities, most Australians have benefited from the fruits of economic growth, including low unemployment, rising incomes, tax relief and rising asset prices. When you step and look at the aggregate, we have done really well. We have this brand of economic development which is a type of democracy where we make sure that we sustain growth but we have a really strong social compact that sustains our values. The hostility to business is particularly troubling, says Cilento. Maintaining the competitiveness of business big and small is fundamental to future economic opportunities. We know that business investment plays a critical role in supporting improved productivity and, in turn, higher incomes. However, this is clearly not connecting to the aspirations of the community, even where the link is direct for instance, through shareholder returns to superannuation. More needs to be done to reduce this disconnect. The business case for reform Business is worried too. Business is clearly in no position to lecture anyone, says Jennifer Westacott, the chief executive of the Business Council of Australia. But it is very hard to get anything done. And it s not just political instability. I think clearly that is part of it although I m always taken a by how resilient our institutions are when we now have this more frequent leadership change. In contrast to the big reform era of the 1980s, Westacott says the problems facing today s modern economy are more nuanced. I think the problem we re trying to solve is not evident to people. So, we end up going down a path where people say, Why are we doing this again? I think sometimes things are just so complex. In the past, people have just trusted governments to get things down. Now, people aren t just willing to say, These people in power know what they re doing. That lack of trust means complexity becomes more difficult to manage. Westacott is scathing of the often very poor process by which public policies are formulated today, citing the lack of a business case for the NBN. Energy policy, she says, is a mess. The architect of the Coalition s abandoned National Energy Guarantee, the Energy Security Board chair, Kerry Schott, recently expressed similar frustration. I characterise the general state of affairs right now as anarchy, Dr Schott told an Australian Financial Review energy summit. Westacott s a recent observation by economist Ross Garnaut that there had been a death of the independent centre in Australia. We haven t seen a green or white paper for some time in Australia, she says. When people float an idea it just seems to get killed. They get asked, Are you going to rule this in or out? As you rule more and more things out, there is less freedom to reform. There is much at stake, she says. The simple reality is that wages have been not growing as fast as people want or need and that s directly linked, whether people like it or not, to productivity. Our productivity is poor and our productivity is driven by investment, which is driven by our competitive settings. We have to ask ourselves, as a business lobby, what do we really stand for? We want to see a stronger, better economy capable of caring for its people. Is that a bad thing? A basic competency issue In 2012, former NSW Treasury secretary Percy Allan oversaw the release of the study Public policy adrift. It rated 18 public policies against whether they met the Wiltshire test (devised by University of Queensland academic Kenneth Wiltd shire) for good public policy development: including establishing a clear df li f ti need for policy reform, creating a green paper identifying reform options, extensive public consultation, producing a white paper with reform recommendations, and having a strategic communication strategy to convince voters of the merits of a reform. Ten out of 18 policies assessed failed the test, including the NBN and the GFC stimulus Building the Education Revolution. This year, the study was repeated in a novel fashion. In an Australian first, think tanks from opposite ends of the ideological divide the rightwing Institute of Public Affairs and the left-wing Per Capita came together to assess the rigour of the development process behind 20 policies. There was striking agreement, with both groups identifying four policies, in particular, that showed an unacceptable level of rigour: the same-sex marriage postal survey, the decision to create a federal Home Affairs department, the NSW government s local council mergers policy and the Queensland government s laws on vegetation management. Good policy process from actually undertaking cost-benefit analysis to having a detailed plan for how a policy will be rolled out is not a left-right issue; it is an issue of basic competency, says the IPA s director of policy, Simon Breheny. From Westminster to Washminster Allan, who now consults to the private and public sectors, points the finger at the growing role of political

54 Age, Melbourne Author: Jessica Irvine Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 125,930 Words: 2658 Item ID: Page 3 of 5 advisers in perverting the policy process, crowding out the advice of public servants. The situation now is that ministers have more advisers in their private ministerial offices. Many of them are recruited from politically affiliated lobbying and polling organisations where the skill set is political analysis and marketing rather than policymaking, says Allan. Australia has gradually moved from a traditional UK Westminster government to a polyglot Washminster model that borrows from the Washington style of public administration. In Washington, Allan explains, top bureaucrats are political appointees: It s only from the middle to lower tiers of public service management that American public servants are recruited on merit, not political affiliation. In America, there is an army of senior public thinkers who move between the bureaucracy (when their chief is president or governor) and think tanks (such as the Brookings Institution when their party is out of power). This has advantages (e.g. bright people committed to a government s agenda are in charge of effecting policy) and disadvantages (e.g. ideologues take control of the administrative apparatus of public policymaking and override evidence and consultation in advancing solutions to complex problems). Social media s perfect storm Tim Gartrell is the former national secretary of the Australian Labor Party who helped deliver Kevin 07 to power. He agrees there has been a hollowing out of the federal bureaucracy. I do think there s a problem, says Gartrell, who also points to the relentless rise of social media for the apparent breakdown in good public policymaking. There s just less considered thinking about things, the speed and velocity of how things are decided. I hear less and less, We should sleep on this, we will make a better judgment in the morning. It s a worry. But even as the media cycle has intensified, fewer Australians are truly engaged with politics, says Peter Lewis, the executive director of Essential Media, which has also conducted research showing dissatisfaction with Australian democracy. I think the results are a response to that fact that the structures that underpin our democracy are getting weaker. Fewer people consume news. Fewer people trust their public institutions. Fewer people think politicians represent their interests, says Lewis. As interest wanes, politics makes more noise to be heard, only to further alienate the public in the process. This creates a climate for easy solutions and hero figures 2004 to come in and clean up the mess. So where to from here? Amid an increasing sense of policy chaos, a new microcosm is forming around finding ways to fix Australian democracy. Percy Allan just wants politicians to return to the old way of doing things, committing to an evidencebased policymaking process run more by public servants and less by political cabals. That involves establishing the known facts and stakeholder views about a situation, identifying the alternative policy options, weighing up their pros and cons, sharing that with the public and inviting its reaction, after which finalising a policy position to put before Parliament or effect by regulation, says Allan. Winning public trust in the process of government is crucial, he says: I believe the public has turned against government not so much over policy but the way policy is decided, announced and executed. Peter Shergold agrees the public service needs to restore its policy advising capabilities while partnering more with business and community groups to get their views. In today s uncertain environment, he says, the ability of public administrators to serve successive governments in an apolitical manner has become significantly more important to the healthy functioning of the machinery of democratic government. A campaign is also needed, says Shergold, to restate the importance of a rigorous, independent public service as central to the operations of the maintenance of a civil society and as bedrock of democratic governance. Ian McAllister, a professor of political science at the ANU, and codirector of the Australian Election Study, offers some more radical solutions, including fixed four-year parliamentary terms and Senate reform. Australians rejected the idea of four-year terms in a 1988 referendum because they prefer to keep politicians on a short leash, McAllister says but governments need a chance to govern. [Four-year terms] would put less pressure on political parties to perform in the short term and give them more time to actually do something, and voters could either punish or reward them at the next election. Senate reform is also needed, says McAllister. Australia is one of only four countries globally where the upper house can veto legislation from the lower house the US, Switzerland and Germany being the others. It has long since ceased to be a representation of the states and territories. It s a microcosm of party conflict. That wouldn t matter, except it s extremely powerful. McAllister would also like to see reform of parliamentary procedures, including the appointment of an independent speaker and limits on question time. Ralph Ashton is the executive director of the Australian Futures Project, a not-for-profit, charitable organisation formed with the mission to fix short-termism in Australia.

55 Age, Melbourne Author: Jessica Irvine Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 125,930 Words: 2658 Item ID: Page 4 of 5 The biggest thing that has to happen is there needs to be a recognition that the system even if it s not broken is struggling to be functional in the current context, and that s because there has been rapid change and the system is under stress, Ashton says. My top solution is the meta solution. We need a process that says these are all just good ideas until people of goodwill come together and resolve to fix the system, even if it takes five to 10 to 15 years. We need to go beyond the natural human instinct of getting angry and looking to lay blame and realise that a lot of different people are responsible and, in some way, the world just changed. CEDA s Cilento agrees. She says public policy decision-making has to become more transparent, involving more engagement with citizens, to restore public trust in democracy. I think that the way we are going to have to go about policy is different to the way we have in the past. Most of all, says Cilento, Australians need to avoid falling prey to excessive gloom about their future. We need to be more optimistic. We should have faith. We have fixed our future before. When you look to the late 1970s, people would have thought the future was pretty bleak, and we fixed that. We just have to keep talking about it. COMMENT Unlocking a better future Page 18 NEXT WEEK The trouble with tax Business is clearly in no position to lecture anyone. Jennifer Westacott, Business Council of Australia

56 is a collaboration between 19 Nov 2018 Age, Melbourne Author: Jessica Irvine Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 8 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 125,930 Words: 2658 Item ID: Page 5 of % (1979) Aftermath governme ath of Whitlam ment s dismissal % % of Australians satisfied with democracy (1996) John Howard elected PM % % 86% % 74% (2007) Kevin Rudd 72 % elected PM (2010) Julia Gillard elected after deposing Rudd two months prior % (2013) Tony Abbott elected (2015) Malcolm Turnbull elected % Source: Survey by the Australian Election Study, ANU

57 Age, Melbourne Author: Clancy Yeates Sarah Danckert Section: General News Article type : News Item Classification : Capital City Daily : 83,229 Page: 10 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 8,783 Words: 267 Item ID: Page 1 of 1 Bank top brass to face the music Clancy Yeates Sarah Danckert The top brass of Australia s banking sector will have their turn in the Hayne royal commission witness box over the next fortnight, to be grilled over the run of scandals and the commission s interim report, which blasted the industry as being driven by greed. After a year of damning revelations of misbehaviour by banks, wealth managers, and insurance companies, chief executives and some chairmen have been summonsed for the final round of public hearings, which commence today in Sydney before commissioner Kenneth Hayne. Commonwealth Bank, Westpac, Macquarie Group and the corporate regulator will be questioned by the commission s senior counsel this week, as the powerful inquiry turns its attention to the root causes of misconduct, and what might be done to stamp it out. CBA, the country s largest and most scandal-prone bank in recent years, will be the first lender put under the spotlight, with chief executive Matt Comyn to appear today, followed by chairman Catherine Livingstone. In preparation for the upcoming grilling of the bankers, the royal commission has demanded detailed documents from banks on a wide range of issues, including remuneration, internal policies and governance arrangements. Shaw and Partners analyst Brett Le Mesurier said the bank CEOs and chairs would need to demonstrate the banks had thoroughly looked into how scandals occurred, and the underlying problems were being addressed. They will have to come up with a reasonable case as to how these things happened under their watch, Mr Le Mesurier said. Westpac chief executive Brian Hartzer will take to the stand after CBA s turn, while Macquarie Group chief Nicholas Moore will also appear.

58 Australian Financial Review, Australia Section: Letters Article type : Letter Classification : National : 44,635 Page: 35 Printed Size: cm² Region: National Market: Australia ASR: AUD 2,104 Words: 273 Item ID: Page 1 of 1 Super boost hardly over the top In the Rear Window of November 15 Paul Keating argues both sides of superannuation, columnist Myriam Robin takes issue with my claim the Superannuation Guarantee can be paid at an extra 2.5 per cent, taking it to 12 per cent, without any loss in wages by employees. Employers have enjoyed a 10 percentage point increase in productivity over the past five or six years while awarding none of it to wages. John Daley of the Grattan Institute claims a further increase in super to 12 per cent will cost workers an increase in wages. This is untrue. Workers are not getting real wage increases anywhere, and can t get them. The Reserve Bank governor makes the point every week. So the award of an extra 2.5 per cent of super to employees via the Super Guarantee will give them a share of productivity they will not get in the market without any loss to their cash wages. Daley knows this but admitting it destroys his argument. In the 1990s and 2000s, when strong real wage increases were everywhere, a decision by employees to take superannuation in lieu did reduce cash wages to them. I had said as much, as Robin noted. But now, where no real wage increases are available at all, a decision by the government to lift the Superannuation Guarantee by 2.5 per cent would simply present as an economic gift, at no wage cost to workers a productivity transfer via profits to wages at no reduction in cash. This should not be too subtle a point for Robin to get her mind across. PJ Keating Potts Point, NSW

59 19 Nov 2018 Australian Financial Review, Australia Author: Adele Ferguson Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 10,235 Words: 860 Item ID: Page 1 of 2 Common thread Matt Comyn s past at CBA connects him most closely to the period of misconduct the Hayne inquiry has examined. James Thomson page Adele Ferguson James Thomson aferguson@fairfaxmedia.com.au; j.thomson@fairfaxmedia.com.au Twitter:@Adele_ferguson Risk and opportunity for Comyn Commonwealth Bank chief executive Matt Comyn might be the most vulnerable bank executive who will front the banking royal commission this week. Not only is CBA the biggest bank in the country, and the institution that has suffered the most scandals in recent years, but Comyn is the CEO whose past connects him most closely to the period of misconduct the commission has examined. NAB chief Andrew Thorburn came to the top job after running NAB s bank in New Zealand. ANZ s Shayne Elliott was appointed CEO after serving as chief financial officer, and before that as head of the bank s institutional division. Brian Hartzer will front knowing Westpac has largely escaped the commission s glare. But Comyn s previous role as the head of CBA s retail bank puts him squarely in the middle of many of the commission s key areas of focus. Take CBA s adherence to responsible lending principals. Or the conduct, remuneration and role of mortgage brokers. Or remuneration, particularly of frontline staff. Or the management of conflicts. Or the mis-selling of some insurance products. All issues the commission has addressed in brutal detail, all issues that revolve around the retail bank. Given what we ve seen from the commission s hearings so far, there is little doubt Commissioner Kenneth Hayne and counsel assisting Rowena Orr, QC, will force Comyn to explain how and why misconduct occurred, and whether it was dealt with in an appropriate way. Comyn, who has been locked in intense preparation of his appearance according to CBA insiders, will know he is going to be made to squirm. But what makes Comyn more vulnerable than his peers his direct operational experience, and this long list of scandals may also provide him with an opportunity. It s nothing to brag about of course, but the fact CBA s culture has already been so brutally examined by the Australian Prudential Regulation Authority s independent inquiry means CBA has arguably (and necessarily) done more to reform its culture than the other banks. As such, Comyn should get the opportunity to demonstrate the changes that CBA has put in place to improve its systems, processes and culture. On responsible lending, for example, Comyn will likely need to wear the pain of some ugly case studies. But he should also be well-placed to explain exactly what CBA does to examine a borrower s financial state and how this has changed. And he can discuss with Hayne CBA s dual multipronged argument about just how responsible lending actually is. CBA says that while the bank has improved the way it assesses a borrower s income and expenses, extraordinarily low default rates suggest this problem may be overblown and there is a risk that credit could dry up if rules become too prescriptive. On remuneration for front-line staff, Comyn will have to wear criticism of the way CBA has used commissions to drive sales, tempting staff to put profits ahead of customer needs. But he will also likely get a chance to explain the balanced scorecard approach the business has now taken, and make the case for the survival of financial incentives that are connected to business growth. Make no mistake: Comyn and CBA chairman Catherine Livingstone will likely be put under severe pressure in the witness box. Livingstone, who usually stays resolutely on message, could face a AFRGA1 A040 particularly testing time, given the relentless way Orr probes to get to the bottom of issues. But Livingstone and Comyn should also get the chance to explain how they are not waiting for the commission s recommendation to start the long rebuild of the culture of CBA. There are even recent examples the pair can give, such as the bank s introduction in late September of its so what test, which requires a staff member to ask themselves, among other things, if they would be comfortable telling their family and friends about a decision, and consider if it is fair to customers and the community. The test would appear to speak to Hayne s oftenstated desire to see simple principles pushed down through bank staff. Comyn s tone at the recent House of

60 Australian Financial Review, Australia Author: Adele Ferguson Section: General News Article type : News Item Classification : National : 44,635 Page: 1 Printed Size: cm² Region: National Market: Australia ASR: AUD 10,235 Words: 860 Item ID: Page 2 of 2 Representatives economic committee hearings into the banks was one of deep, almost exaggerated, contrition. That was perhaps understandable given these hearings were essentially a chance for MPs from both sides to indulge in a little bank bashing of their own. But it s likely Hayne s hearings will take a more practical tone. Certainly, Orr and her team will want to force the bank chiefs to answer to community anger. But Hayne also needs to zero in on practical reform. As he said in his interim report, change to the law won t necessarily do much to change culture. So the big question is: what policy measures will deliver change? Comyn should get a chance to shape that discussion. If he can survive a grilling from Orr, that is. Orr and her team will want to force the bank chiefs to answer to community anger. Matt Comyn will be made to squirm in the banking royal commission witness box. PHOTO: AAP

61 Sydney Morning Herald, Sydney Author: Clancy Yeates Sarah Danckert Section: General News Article type : News Item Classification : Capital City Daily : 88,634 Page: 5 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 20,155 Words: 480 Item ID: Page 1 of 1 ROYAL COMMISSION Bank bosses next to face the music Clancy Yeates Sarah Danckert The top brass of Australia s banking sector will have their turn in the Hayne royal commission witness box over the next fortnight, to be grilled over the run of scandals and the commission s interim report, which blasted the industry as being driven by greed. After a year of damning revelations of misbehaviour by banks, wealth managers, and insurance companies, chief executives and some chairmen have been summonsed for the final round of public hearings, which commence on Monday in Sydney before commissioner Kenneth Hayne, a former High Court judge. Commonwealth Bank, Westpac, Macquarie Group and the corporate regulator will be questioned by the commission s senior counsel this week, as the powerful inquiry turns its attention to the root causes of misconduct, and what might be done to stamp it out. CBA, the country s largest and most scandal-prone bank in recent years, will be the first lender put under the spotlight, with chief executive Matt Comyn to appear on Monday, followed by chairman Catherine Livingstone. In preparation, the royal commission has demanded detailed documents from banks on a wide range of issues, including remuneration, internal policies and governance arrangements. Shaw and Partners analyst Brett Le Mesurier said the bank CEOs and chairs would need to demonstrate the banks had thoroughly looked into how scandals occurred, and the underlying problems were being addressed. They will have to come up with a reasonable case as to how these things happened under their watch, Mr Le Mesurier said. Westpac chief executive Brian Hartzer will take to the stand for the country s second largest bank after CBA s turn, while Macquarie Group chief Nicholas Moore will also appear the first public scrutiny of Macquarie by the Hayne commission. Joining the banking executives during the Sydney round will be Australian Securities and Investments Commission (ASIC) chairman James Shipton. Commissioner Hayne s interim report slammed ASIC for being too reluctant to take banks to court, and too willing to compromise. Bell Potter analyst TS Lim said he thought most of the banks dirty laundry had been aired by now. Mr Lim said he thought that rather than unearthing new scandals, this round of hearings would be focused on the steps banks had taken to stop future misconduct. Hayne is going to be more like a school master telling them off, Mr Lim said. Next week in Melbourne, NAB chief executive Andrew Thorburn is set to take to the witness box and is expected to face questions over issues including the bank s charging of fees for financial advice that was never provided. NAB also confirmed last week a number of unintended breaches of the company s policies relating to gifts by Mr Thorburn. NAB chairman and former Treasury Secretary Ken Henry is also set to front the inquiry. Feeling the pinch The royal commission has contributed to billions being wiped off financial institutions share prices this year.

62 Hobart Mercury, Hobart Section: General News Article type : News Item Classification : Capital City Daily : 28,265 Page: 6 Printed Size: cm² Region: TAS Market: Australia ASR: AUD 788 Words: 221 Item ID: Page 1 of 1 Bank chiefs face probe blowtorch ROYAL commissioner Kenneth Hayne QC is expected to apply a blowtorch to bank bosses over widespread greeddriven misconduct in the financial services industry. The CEOs of the big four banks and AMP are among those appearing at the commission s final public hearing, along with the heads of regulators criticised by Mr Hayne for letting much of the misconduct go unpunished. They will have to be armed with more than apologies when they appear, beginning today with Commonwealth Bank of Australia CEO Matt Comyn and chairwoman Catherine Livingstone. Consumer advocacy group Choice CEO Alan Kirkland said Mr Hayne s interim report raised questions about how the misconduct happened that had yet to be fully answered. I don t think of any of them have got adequate answers, Mr Kirkland said. That s where he ll be really applying a blowtorch. Mr Kirkland said Australia s largest bank blamed pockets of poor culture for the misconduct in a submission at the start of the inquiry, but it was clear there were systemic problems across the industry He expects the CEOs to be grilled about how such big systemic problems happened on their watch and what they are doing to stop it happening again. The sheer dollars involved that they ve already had to refund or set aside for refunds - these are not small mistakes, they re massive systemic errors.

63 West Australian, Perth Author: Nick Evans Section: General News Article type : News Item Classification : Capital City Daily : 147,676 Page: 6 Printed Size: cm² Region: WA Market: Australia ASR: AUD 3,278 Words: 296 Item ID: Page 1 of 1 Banking chiefs to face probe blowtorch Nick Evans Australia s big bank bosses will finally face the music over the misdeeds of their companies today as the banking royal commission enters its final stage. The stakes are high, personally and for the organisations they represent. Revelations flowing from previous grillings have already cost 16 senior executives and board members their jobs. Key for the banks is the answer to a question posed by Commissioner Kenneth Hayne in his interim report will better enforcement of the existing laws help fix an endemic culture of greed in Australia s financial services industry, or is structural change necessary? During earlier hearings more than 100 senior banking and insurance executives admitted a shocking litany of wrongdoing, including charging billions for undelivered services, sending small businesses broke to pad profits, targeting the poor and disabled with products they did not need and could not afford, and even collecting life insurance premiums from the dead. Expected on the stand this week are the heads of Commonwealth Bank, including chief executive Matt Comyn and chairwoman Catherine Livingstone, along with Westpac managing director Brian Hartzer and outgoing Macquarie Group chief executive Nicholas Moore. Mr Moore, who took home a pay packet worth $18.9 million last year, is alone amongst the group in not having been embarrassed by a parade of wrongdoing by his underlings during the previous six rounds of hearings. The other highly-paid executives won t necessarily face the detailed forensic examination of banking misdeeds that wrecked reputations in previous hearings. But a grilling on the causes of the scandals revealed earlier this year could put the blowtorch on the bank chiefs. Commissioner Hayne has made it clear he will not accept any attempt to blame a few bad apples in their businesses for the widespread rip-offs by banks and insurance companies.

64 Hobart Mercury, Hobart Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 28,265 Page: 18 Printed Size: cm² Region: TAS Market: Australia ASR: AUD 5,848 Words: 840 Item ID: Page 1 of 2 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good

65 Hobart Mercury, Hobart Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 28,265 Page: 18 Printed Size: cm² Region: TAS Market: Australia ASR: AUD 5,848 Words: 840 Item ID: Page 2 of 2 substitute for the Big Four in an investment portfolio that needs higher growth options among diversified

66 Hobart Mercury, Hobart Author: Anthony Keane Section: Business News Article type : News Item Classification : Capital City Daily : 28,265 Page: 18 Printed Size: cm² Region: TAS Market: Australia ASR: AUD 1,626 Words: 433 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

67 Canberra Times, Canberra Author: Katie Burgess Section: General News Article type : News Item Classification : Capital City Daily : 17,579 Page: 1 Printed Size: cm² Region: ACT Market: Australia ASR: AUD 9,810 Words: 708 Item ID: Page 1 of 2 C.T.P. SCHEME Concern over compensation process Insurers say new changes unfair Katie Burgess Assembly reporter Injured drivers could soon have to pay an excess to challenge insurers assessments of their injuries, with even insurance companies labelling the changes unfair. The Barr government s proposed compulsory third party insurance scheme has already been attacked by unions for handing insurance companies too much power in the wake of the banking royal commission. Lawyers also say the scheme will severely reduce compensation to road traffic victims. But even Insurance Australia Group which under the NRMA brand underwrites 164,000 CTP insurance policies in the ACT has described parts of the process that will determine who is eligible for extra compensation as unfair. While anyone injured in a motor vehicle accident will be able to access treatment and care for up to five years regardless of fault, only those that pass a 10 per cent whole of person impairment threshold can sue for extra benefits. The company told an ACT Legislative Assembly inquiry into the proposed scheme it was concerned about the complexity of the assessment process. Injured people will be required to take in complex information upon which they will be required to make decisions that have potentially significant financial impacts upon them. All of this while they are dealing with the effects of their injuries, its submission said. It is also likely that the complexity of the process will cause injured people to seek the assistance of a lawyer, for which no legal costs may be payable by the insurer. The company said it was particularly concerned by the requirement for injured people to pay an excess to the insurer for the assessment where the insurer considers there is no permanent impairment. We consider that this requirement disadvantages those injured people of lesser financial means. We also submit that enforcing this process and collecting/recovering excess amounts would be administratively difficult Continued Page 2

68 Canberra Times, Canberra Author: Katie Burgess Section: General News Article type : News Item Classification : Capital City Daily : 17,579 Page: 1 Printed Size: cm² Region: ACT Market: Australia ASR: AUD 9,810 Words: 708 Item ID: Page 2 of 2 Insurers say Barr changes to CTP unfair From Page 1 and expensive, to say nothing of the impact on the relationship between the injured person and insurer, its submission said. The excess is likely to be set at $500 or one-quarter of the assessment fee, whichever is higher. Asked whether the changes were fair, a government spokeswoman said the cost of a whole person impairment assessment can be in the thousands of dollars. An excess payment for the independent assessment is only required where the injured person requests the independent assessment even though they are not considered to have any likely permanent impairment as a result of their accident, she said. The excess payment is fully refundable if the injured person s Whole Person Impairment assessment by an authorised independent medical examiner determines the injured person has some permanent impairment (eg, more than 0 per cent). The insurance group also hit out at the decision to cut income benefits for injured people who are at retirement age plus 26 weeks. The clause will mean an injured person who is older but working will receive no income replacement if they are unable to work because of it. This is an unjust outcome for injured people who continue to work past retirement age by choice or need, the company said. The government spokeswoman said the cut-off was consistent with statutory motor accident schemes and workers compensation schemes in other jurisdictions, and was included in the model chosen by the citizens jury. At this point, people can access the Commonwealth age pension and/or their superannuation benefits to provide income. Older people with more serious injuries, and are not at fault, can still make a common law claim for damages, including for any lost income. The scheme would also prevent injured people from claiming damages for lost earnings in the first year after the accident. The provision seems geared to prevent duplication, as there are income replacement payments available. But Insurance Group Australia told the inquiry it would mean people who were out-of-work for reasons like unpaid maternity leave would be locked out of recovering those lost earnings forever. It will also leave injured people out of pocket on superannuation. The government spokeswoman said the requirement that injured people receive defined benefits for loss of income for the first year after an accident was a design feature of the model.

69 Canberra Times, Canberra Section: General News Article type : News Item Classification : Capital City Daily : 17,579 Page: 7 Printed Size: cm² Region: ACT Market: Australia ASR: AUD 2,587 Words: 225 Item ID: Page 1 of 1 Bank bosses to face Hayne grilling The top brass of Australia s banking sector will have their turn in the Hayne royal commission witness box over the next fortnight, to be grilled over the run of scandals and the commission's s interim report, which blasted the industry as being driven by greed. After a year of damning revelations of misbehaviour by banks, wealth managers, and insurance companies, chief executives and some chairmen have been summonsed for the final round of public hearings, which commence on Monday in Sydney before commissioner Kenneth Hayne, a former High Court judge. Commonwealth Bank, Westpac, Macquarie Group and the corporate regulator will be questioned by the commission s senior counsel this week, as the powerful inquiry turns its attention to the root causes of misconduct, and what might be done to stamp it out. CBA, the country s largest and most scandal-prone bank in recent years, will be the first lender put under the spotlight, with chief executive Matt Comyn to appear today, followed by chairman Catherine Livingstone. In preparation for the upcoming grilling of the bankers, the royal commission has demanded detailed documents from banks on a wide range of issues. Shaw and Partners analyst Brett Le Mesurier said the bank CEOs and chairs would need to demonstrate the banks had thoroughly looked into how scandals occurred, and the underlying problems were being addressed. Clancey Yeates, Sarah Danckert

70 Northern Territory News, Darwin Author: Anthony Keane Section: Business News Article type : News Item Classification : Capital City Daily : 11,279 Page: 16 Printed Size: cm² Region: NT Market: Australia ASR: AUD 1,265 Words: 433 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

71 Northern Territory News, Darwin Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 11,279 Page: 16 Printed Size: cm² Region: NT Market: Australia ASR: AUD 4,507 Words: 840 Item ID: Page 1 of 2 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group:

72 Northern Territory News, Darwin Author: David Libby Koch Section: Business News Article type : News Item Classification : Capital City Daily : 11,279 Page: 16 Printed Size: cm² Region: NT Market: Australia ASR: AUD 4,507 Words: 840 Item ID: Page 2 of 2 A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

73 West Australian, Perth Author: Neale Prior Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 3 Printed Size: cm² Region: WA Market: Australia ASR: AUD 1,964 Words: 219 Item ID: Page 1 of 1 Warning on selfies Neale Prior It s kind of refreshing when an industry group releases a report to promote a week named in its widget s honour and warns its widgets are not for everyone But that s just what the SMSF Association has done with a report released this morning to mark a week where it will be talking about the joys and pitfalls of self-managed superannuation funds. The SMSF Association and OpenInvest said DIY super was appropriate for people who had the time, balance and financial knowledge. So, the next time a friend at a barbecue starts talking about their SMSF, remember that the option to take control of your superannuation needs to be right for your circumstances, they said. Accountants surveyed by Investment Trends on average said the minimum starting balance for an SMSF should be about $240,000, while financial planners said the balance should be at least $310,000. The average DIY trustee spends: 1.7 hours a month on administration and paperwork. 2.3 hours on ongoing monitoring and reporting. 3.3 hours researching and selecting investments. 1.1 hours keeping up with legal requirements. The average annual ongoing cost of managing a SMSF was $2500. Trustees observed a further $400 in once-off costs and $1400 in investment costs. Trustees cited regulatory uncertainty as their biggest challenge, just ahead of investment selection.

74 West Australian, Perth Author: Tracey Scotchbrook Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 4 Printed Size: cm² Region: WA Market: Australia ASR: AUD 6,066 Words: 689 Item ID: Page 1 of 2 LRBAs face hard labour under Labor with Tracey Scotchbrook Labor and industry super funds dislike self-managed superannuation funds borrowing. Known as limited recourse borrowing arrangements, they have played an important role in helping Australians to use their super to fulfil the national dream of owning investment properties. However, LRBAs are likely to face some tough new rules under a Labor Government. LRBAs are still legal but the rules are effectively becoming impotent. The problem is withdrawal of the big banks and further lending restrictions being applied by the second-tier lenders who remain in this space. Issues will continue to arise because of the banks changing lending policies. These changes have included ceasing to offer interest-only loans, more conservative lending ratios and changing lending guidelines, including the type of property on which they will lend. The exit of the major lenders from the LRBA market has been swift. For new applicants or those seeking to refinance with another lender, second-tier lenders continue to offer LRBA products. This includes Macquarie, Bank of Queensland and Bendigo Bank. However, those who are looking to acquire newly constructed property using a LRBA are finding it extremely difficult to find a bank who will agree to the loan. We are already seeing a reluctance by banks to lend to SMSFs that are looking to buy new property. Ironically, Labor s proposed changes to the broader negative gearing rules seek to limit negative gearing to new property. Commercial reality and policy do not seem to align if what is happening in the SMSF market is any indication. New property has been an area of risk for the banks where SMSFs and LRBAs are concerned. This is because of the tight restrictions that apply to LRBAs coupled with east coast apartment developments that have suffered big losses. It is anybody s guess what extra changes in lending policies will be applied over the next two years as the shake-out from the Sydney and Melbourne investment property boom continues. For anyone signing up to buy a property off the plan now, there is a significant risk they will be unable to obtain the

75 West Australian, Perth Author: Tracey Scotchbrook Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 4 Printed Size: cm² Region: WA Market: Australia ASR: AUD 6,066 Words: 689 Item ID: Page 2 of 2 required debt funding on completion. Bank lending practices in general are changing. Much of this is in response to the royal commission. The tight regulations that apply to LRBAs make them an even harder proposition for the banks in this climate. It would seem the pendulum has well and truly swung. The royal commission, together with two ASIC reports on the quality of SMSF advice issued in late June, have not helped the perception of LRBAs due to issues of spruiking, one-stop shops and inappropriate advice involving SMSFs and LRBAs. In reality, this is not representative of what happens in the broader SMSF market. They are issues that do need to be addressed and the SMSF industry would be happy for this to happen. However, throwing out the baby with the bathwater is not the answer. The irony is that the big superannuation funds, including industry funds, borrow to invest. If the strategy, timeline and investment is right, borrowing to invest can provide long-term income and capital growth opportunities. It is clear that LRBAs have an image problem. When exiting the LRBA market the big banks stated that they would continue to support existing customers. There will be SMSFs that will have existing loans on interest only repayments or fixed interest periods that will expire. These funds may find that they are stuck with what their current lender will offer them when the time comes. The reality is it will get harder for SMSFs to refinance with another institution or seek a better deal. The door is rapidly closing and could see SMSFs locked in with their current lender. Lack of competition or facilities is less than ideal. In fact, it is a big problem. If Labor wins government next year they will likely push forward with their policy proposal to ban LRBAs. One would hope that anyone with existing arrangements will have those grand-fathered. But more importantly, many SMSFs will be prevented from investing in direct property and using gearing as part of their long-term retirement planning strategy. Tracey Scotchbrook is director of Superology

76 Daily Mercury, Mackay QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 7,207 Page: 14 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 241 Words: 433 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

77 Daily Mercury, Mackay QLD Section: General News Article type : News Item Classification : Regional : 7,207 Page: 14 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 710 Words: 840 Item ID: Page 1 of 2 Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly.

78 Daily Mercury, Mackay QLD Section: General News Article type : News Item Classification : Regional : 7,207 Page: 14 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 710 Words: 840 Item ID: Page 2 of 2 The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

79 Queensland Times, Ipswich QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 6,256 Page: 16 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 207 Words: 436 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged e under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

80 Queensland Times, Ipswich QLD Section: General News Article type : News Item Classification : Regional : 6,256 Page: 16 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 625 Words: 840 Item ID: Page 1 of 2 Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly.

81 Queensland Times, Ipswich QLD Section: General News Article type : News Item Classification : Regional : 6,256 Page: 16 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 625 Words: 840 Item ID: Page 2 of 2 The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

82 Geelong Advertiser, Geelong VIC Section: General News Article type : News Item Classification : Regional : 16,687 Page: 12 Printed Size: cm² Region: VIC Market: Australia ASR: AUD 507 Words: 351 Item ID: Page 1 of 1 Bank bosses to face the music at inquiry ROYAL commissioner Kenneth Hayne QC is expected to apply a blowtorch to bank bosses over the greed-driven misconduct in the financial services industry. The chief executives of the big four banks and AMP are among those appearing at the commission s final public hearing, along with the heads of regulators criticised by Mr Hayne for letting much of the misconduct go unpunished. They will have to be armed with more than apologies when they appear, starting today with Commonwealth Bank chief Matt Comyn and chairwoman Catherine Livingstone. Consumer advocacy group Choice chief executive Alan Kirkland said the interim report raised questions about how the misconduct happened that had yet to be fully answered. I don t think of any of them have got adequate answers so far, Mr Kirkland said. I think that s where he ll be really applying a blowtorch to people like Matt Comyn and Catherine Livingstone. He said Australia s largest bank blamed pockets of poor culture for the misconduct, but it was clear there were systemic problems across the industry. He expects the CEOs to be grilled about how such problems happened on their watch and what they were doing to stop it happening again. The sheer dollars involved that they ve already had to refund or set aside for refunds these are not small mistakes, they re massive systemic errors, Mr Kirkland said. The final public hearing will look at the causes of the misconduct and possible responses, including regulatory reform. I would expect the royal commission will be asking tough questions around what are they going to do to fix their remuneration structures so they re not creating incentives for consumers to be ripped off, Mr Kirkland said. Australian Banking Association chief Anna Bligh said the industry had committed to tackling key areas, saying issues demanded swift action. It included overhauling staff pay and the treatment of deceased estates, ending fees for no service, reforming commissions for mortgage brokers and supporting legislation to end grandfathered payments to financial advisers. Tackling these issues are an important start, however the industry acknowledges that there is more to be done, Ms Bligh said.

83 Gladstone Observer, Gladstone QLD Section: General News Article type : News Item Classification : Regional : 3,301 Page: 15 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 608 Words: 840 Item ID: Page 1 of 2 Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a

84 Gladstone Observer, Gladstone QLD Section: General News Article type : News Item Classification : Regional : 3,301 Page: 15 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 608 Words: 840 Item ID: Page 2 of 2 strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good

85 Gladstone Observer, Gladstone QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 3,301 Page: 15 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 209 Words: 436 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

86 Launceston Examiner, Launceston TAS Section: General News Article type : News Item Classification : Regional : 17,631 Page: 10 Printed Size: cm² Region: TAS Market: Australia ASR: AUD 1,444 Words: 230 Item ID: Page 1 of 1 Bank bosses to face the music ROYAL commissioner Kenneth Hayne QC is expected to apply a blowtorch to bank bosses over the widespread and greed-driven misconduct in the financial services industry. The CEOs of the big four banks and AMP are among those appearing at the commission s final public hearing, along with the heads of regulators criticised by Mr Hayne for letting much of the misconduct go unpunished. They will have to be armed with more than apologies when they appear, beginning on Monday with Commonwealth Bank of Australia CEO Matt Comyn and chairwoman Catherine Livingstone. Consumer advocacy group Choice CEO Alan Kirkland said Mr Hayne s interim report raised questions about how the misconduct happened that had yet to be fully answered. I don t think of any of them have got adequate answers so far, Mr Kirkland said. I think that s where he ll be really applying a blowtorch to people like Matt Comyn and Catherine Livingstone from the CBA. Mr Kirkland said Australia s largest bank blamed pockets of poor culture for the misconduct in a submission at the start of the inquiry, but it was clear there were systemic problems across the industry. He expects the CEOs to be grilled about how such big systemic problems happened on their watch and what they are doing to stop it happening again. GETTING TOUGH: Royal commissioner Kenneth Hayne QC is cracking down on bank bosses. Picture: AAP

87 Gold Coast Bulletin, Gold Coast QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 21,468 Page: 21 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 1,658 Words: 433 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

88 Gold Coast Bulletin, Gold Coast QLD Author: David Libby Section: General News Article type : News Item Classification : Regional : 21,468 Page: 21 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 5,846 Words: 840 Item ID: Page 1 of 3 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with

89 Gold Coast Bulletin, Gold Coast QLD Author: David Libby Section: General News Article type : News Item Classification : Regional : 21,468 Page: 21 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 5,846 Words: 840 Item ID: Page 2 of 3 balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan

90 Gold Coast Bulletin, Gold Coast QLD Author: David Libby Section: General News Article type : News Item Classification : Regional : 21,468 Page: 21 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 5,846 Words: 840 Item ID: Page 3 of 3 demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

91 Sunshine Coast Daily, Maroochydore QLD Section: General News Article type : News Item Classification : Regional : 10,046 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 924 Words: 841 Item ID: Page 1 of 3 Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a

92 Sunshine Coast Daily, Maroochydore QLD Section: General News Article type : News Item Classification : Regional : 10,046 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 924 Words: 841 Item ID: Page 2 of 3 strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

93 Sunshine Coast Daily, Maroochydore QLD Section: General News Article type : News Item Classification : Regional : 10,046 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 924 Words: 841 Item ID: Page 3 of 3

94 News Mail, Bundaberg QLD Section: General News Article type : News Item Classification : Regional : 6,176 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 615 Words: 840 Item ID: Page 1 of 2 Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix.

95 News Mail, Bundaberg QLD Section: General News Article type : News Item Classification : Regional : 6,176 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 615 Words: 840 Item ID: Page 2 of 2 Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been. as they have be

96 News Mail, Bundaberg QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 6,176 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 209 Words: 436 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking e royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

97 Morning Bulletin, Rockhampton QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 9,376 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 397 Words: 433 Item ID: Page 1 of 1 THEMORNINGBULLETIN.COM.AU MONDAY, NOVEMBER 19, Employers to pay price for skimping on super ANTHONY KEANE BOSSES who don t pay their workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

98 Morning Bulletin, Rockhampton QLD Author: Libby David Koch Section: General News Article type : News Item Classification : Regional : 9,376 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 922 Words: 840 Item ID: Page 1 of 3 Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most

99 Morning Bulletin, Rockhampton QLD Author: Libby David Koch Section: General News Article type : News Item Classification : Regional : 9,376 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 922 Words: 840 Item ID: Page 2 of 3 likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

100 Morning Bulletin, Rockhampton QLD Author: Libby David Koch Section: General News Article type : News Item Classification : Regional : 9,376 Page: 19 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 922 Words: 840 Item ID: Page 3 of 3

101 Cairns Post, Cairns Author: David Libby Koch Section: General News Article type : News Item Classification : Regional : 13,896 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 4,108 Words: 840 Item ID: Page 1 of 3 MONEYSAVERHQ 27 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in

102 Cairns Post, Cairns Author: David Libby Koch Section: General News Article type : News Item Classification : Regional : 13,896 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 4,108 Words: 840 Item ID: Page 2 of 3 any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

103 Cairns Post, Cairns Author: David Libby Koch Section: General News Article type : News Item Classification : Regional : 13,896 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 4,108 Words: 840 Item ID: Page 3 of 3

104 Cairns Post, Cairns Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 13,896 Page: 27 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 1,128 Words: 436 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of e Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

105 Townsville Bulletin, Townsville QLD Author: David Libby Koch Section: General News Article type : News Item Classification : Regional : 16,484 Page: 20 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 4,885 Words: 840 Item ID: Page 1 of 3 David & Libby Shine of bank shares dims The Big Four aren t delivering the big dividends but they still hold some allure OUTWARDLY, Australians hate banks. Quietly, though, they love them. Yes, the banking royal commission has customers seething at the many examples of poor advice, high fees and dodgy behaviour. But then those same people have loved what the share price performance and attractive fully franked dividends from the Big Four banks have done for their superannuation and investment portfolio returns. Given share prices of the major banks are now hovering around 12-month lows, are the banks completely on the nose both in reputation and investment potential? For decades the major banks have been a trusted loyal foundation for any quality investment portfolio. It used to be that investing in bank shares provided a better return than any product a bank offered a customer. BIG QUESTION They have been extraordinarily good performers on the of what turned out to be, shall we say, flexible lending practices. Since the royal commission the banks have been forced to be stingier with lending. They ve been offloading insurance and wealth management divisions and profits are falling. So the big question now is: Do the banks still deserve that exalted position of being a foundation investment for every quality investment portfolio? Or is it time to dump them? It s a big call to make and what do you replace them with? It is a big hole to fill: A solid, quality stock with a good dividend yield. DON T EXPOSE YOURSELF Banks have gone from three decades of double-digit mortgage-lending growth almost every year to Westpac now predicting mortgage lending growth of just 4 per cent in 2019, sums up Bell Direct equities strategist Julia Lee. This is a difficult environment to grow profits in and, if anything, banks would have to look at cost cutting and reining in expenses to try and maintain current levels of profitability. I would be underweight banks. It s a sentiment also shared by Elio D Amato, executive director at research group Lincoln Indicators. There is very little in the way of catalyst for strong earnings growth, Elio says. Most are trying to be smaller and leaner institutions tomorrow than what they are today. Despite the fact they are cheap relative to historic levels, it is difficult to see how any regrowth will occur. Therefore, in our view, investors seeking dynamic, growing companies should not be exposed to the banks. DIVIDEND PRESSURE It s clear the stock gurus aren t overly impressed with the investment potential of the major banks in the immediate term, despite attractive fully franked dividend yields of between 8 and 11 per cent. Those grossed-up yields have been inflated by the falling share prices but the big question is whether, given falling profits, current dividend payouts can be maintained. At the moment, banks would be able to maintain dividends, Julia says. I wouldn t expect any growth in dividends over the next three years and there is a risk that there could be a cut to dividends, given the soft outlook for Australian banks. Elio agrees, and sees Westpac and NAB as the most likely of all the banks to cut dividends in the future because of their current payout ratios. Both Elio and Julia agree that, of the Big Four banks, ANZ is their preferred choice in terms of dividend yield and potential. It s important to point out no one is suggesting any of our Big Four banks are in

106 Townsville Bulletin, Townsville QLD Author: David Libby Koch Section: General News Article type : News Item Classification : Regional : 16,484 Page: 20 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 4,885 Words: 840 Item ID: Page 2 of 3 any sort of trouble. Far from it. In fact, despite their poor investment performance and falling profits of late, they are still among the strongest, safest financial institutions in the world, with balance sheets that are still rock solid. OTHER OPTIONS The only bank we like from a growth perspective among all of them is not one of the top four. It is Macquarie Group, Elio says. It recently upgraded its fullyear guidance following a strong performance from its capital markets divisions, which demonstrated the strength and diversity of its business mix. Julia agrees that Macquarie is a good substitute for the Big Four in an investment portfolio that needs higher growth options among diversified financial stocks. She also thinks investors should look at Challenger Financial Group. Apart from Macquarie Group, Elio likes the following: Magellan Financial Group: A fund manager with an overseas investment focus. It has committed to paying per cent of after-tax earnings in dividends. Charter Hall Group: A property developer with a funds management arm. It s the premium traditional real estate investment trust. Insurance Group of Australia: An improving insurance premium rate environment with industryleading margins should result in continued high dividends. Rural Funds: Strong tailwinds underline great demand. It s a great lesson on why investment portfolios need to be constantly monitored and advisers consulted regularly. The major banks have been a great ride for investors. But times have changed. Rules are tightening, loan demand is softening and margins are under pressure. They are still great businesses just not as good as they have been.

107 Townsville Bulletin, Townsville QLD Author: David Libby Koch Section: General News Article type : News Item Classification : Regional : 16,484 Page: 20 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 4,885 Words: 840 Item ID: Page 3 of 3

108 Townsville Bulletin, Townsville QLD Author: Anthony Keane Section: General News Article type : News Item Classification : Regional : 16,484 Page: 20 Printed Size: cm² Region: QLD Market: Australia ASR: AUD 1,378 Words: 433 Item ID: Page 1 of 1 Employers to pay price for skimping on super ANTHONY KEANE workers enough super will soon be smacked with a bloody big stick, the Federal Government has warned. Assistant Treasurer Stuart Robert says fresh changes to the Government s super legislation introduce extraordinarily tough penalties for employers who don t come clean about underpaying super. Extra powers have been given to the Australian Taxation Office to use technology to track employers who rip off workers, and a 12-month amnesty allowing bosses to make up missed payments ends in May next year. It is theft of an employee s future, Mr Robert said of bosses failure to pay compulsory 9.5 per cent employer superannuation guarantee (SG) contributions. There will be tougher penalties for those employers who repeatedly short-change their workers. Harsh financial penalties and prison terms loom for serious offenders. We estimate 50,000 lowpaid Australians will receive a combined $230 million, Mr Robert said of the amnesty, which only applied to employers who confessed before the ATO caught them. The amnesty has a carrot, and we re now putting a bloody big stick next to it, he told the The Association of Superannuation Funds of Australia (ASFA) 2018 conference in Adelaide last week. He also announced a minor flip on the plan to scrap automatic life insurance for all super fund members aged under 25 or with low balances. The amendment means workers in dangerous occupations such as police officers, farmers, truck drivers and concreters will not have their cover cancelled. The Government s insurance plan had been widely criticised by the super industry as putting young workers and their families at risk and without a financial safety net. Other calls to shake up super and scrap a planned increase in SG payments to 12 per cent have rattled the superannuation industry. ASFA CEO Martin Fahy said Australia s $2.7 trillion super system would experience tortuous and acrimonious debates in the year ahead amid the fallout from the banking royal commission and other damning reports. The reality is that we ve got a good system, he said. The system we have works, and we cannot allow it to fall apart. Dr Fahy said Australia must reject the temptation to kick the burden of aged care, health care and an ageing population down the road to future generations. The age pension burden in this country sits resiliently at 2-3 per cent (of GDP), he said. The burden of the UK, Germany and Greece is much higher than that, at 7, 9 and 16 per cent respectively. Superannuation is where we take pain in the present to avoid pain in the future. SUPER EXPERT: Martin Fahy.

109 Border Mail, Albury-Wodonga Section: General News Article type : News Item Classification : Regional : 13,519 Page: 11 Printed Size: cm² Region: NSW Market: Australia ASR: AUD 920 Words: 230 Item ID: Page 1 of 1 Bank bosses to face the music ROYAL commissioner Kenneth Hayne QC is expected to apply a blowtorch to bank bosses over the widespread and greed-driven misconduct in the financial services industry. The CEOs of the big four banks and AMP are among those appearing at the commission s final public hearing, along with the heads of regulators criticised by Mr Hayne for letting much of the misconduct go unpunished. They will have to be armed with more than apologies when they appear, beginning on Monday with Commonwealth Bank of Australia CEO Matt Comyn and chairwoman Catherine Livingstone. Consumer advocacy group Choice CEO Alan Kirkland said Mr Hayne s interim report raised questions about how the misconduct happened that had yet to be fully answered. I don t think of any of them have got adequate answers so far, Mr Kirkland said. I think that s where he ll be really applying a blowtorch to people like Matt Comyn and Catherine Livingstone from the CBA. Mr Kirkland said Australia s largest bank blamed pockets of poor culture for the misconduct in a submission at the start of the inquiry, but it was clear there were systemic problems across the industry. He expects the CEOs to be grilled about how such big systemic problems happened on their watch and what they are doing to stop it happening again. GETTING TOUGH: Royal commissioner Kenneth Hayne QC is cracking down on bank bosses. Picture: AAP

110 West Australian, Perth Author: Neale Prior Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 3 Printed Size: cm² Region: WA Market: Australia ASR: AUD 13,762 Words: 859 Item ID: Page 1 of 2 Women are not on track men in their early working years to maximise superannuation saving, Neale Prior or be far more aggressive in later working lives. The Who s the Boss? survey found around 60 per of women in relationships would be relying on their partner for financial support in retirement, compared to around 40 per cent of men. The consistent result in lots of Worries among women about not being comfortable in retirement are increasing amid more evidence of a great financial gender divide. The latest Qantas Super CSBA Retirement Confidence Index to be released today shows just 26 per cent of women are confident they could rely on their super and investments in retirement. This compares with 38 per cent of men who believe they are wellplaced for retirement, and is down on the 30 per cent of women who were confident when the national survey was last done in July. The results of the Qantas Super survey from October reflect landmark WA figures this month in the Who s the Boss? survey, carried out by CoreData for The West Australian and WA Super. Who s the Boss? found only half of single WA women could expect to have enough savings for a semiindependent retirement and less than one-quarter could expect to be comfortable in retirement. With the Your Money team, Core- Data analysts projected the retirement savings of survey participants based on their existing super balances and incomes. Around 40 per cent of men are well-placed to get beyond the $545,000 savings figure the Association of Superannuation Funds of Australia says a single person needs for a comfortable retirement. Only 25 per cent of women could expect to accumulate $545,000. The projections did not take into account the generally bigger salary bump enjoyed by men in their 40s and early 50s and likelihood of women s career progressions and super saving being interrupted by having children. The results strongly suggest that women may have to do more than the research is that women are generally one-third less confident and around one-third more worried than men about retirement. And it is not just a matter of confidence, it is also a matter of engagement. Reflecting Who s the Boss? survey results showing men were twice as likely as women to have a say in superannuation, the Qantas Super survey found just 38 per cent of women were actively involved in making decisions about their retirement. This compared with 49 per cent of men being actively involved in such decisions. Qantas Super chief executive Michael Clancy said the evidence showing a lack of retirement confidence and engagement among women was cause for concern. Mr Clancy said recent Roy Morgan research showing a narrowing gap in superannuation balances was encouraging and a step in the right direction. But he said the lack of engagement by women in super was a real concern given the savings vehicle will play an important role in determining the lifestyle they ll be able to afford in retirement. Roy Morgan research last month found the average super balance for women had grown over the past decade from $68,000 to $127,000, whereas the average male balance had risen from $115,000 to $176,000. That was equal growth in dollar terms, but women had far better average growth in percentage terms 87 per cent for women and 53 per cent for men. But as WA Super boss Fabian Ross said, women would have to save much harder than men for retirement given big differences in super balances and male average earnings more than one-third higher than women s. He said based on average super and earnings, a 42- year-old woman would have to put in $140 a week to reach 67 with around $545,000 in super, against $45 a week for the average man. SUPER WILL PLAY AN IMPORTANT ROLE IN DETERMINING THE LIFESTYLE THEY LL BE ABLE TO AFFORD IN RETIREMENT.

111 West Australian, Perth Author: Neale Prior Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 3 Printed Size: cm² Region: WA Market: Australia ASR: AUD 13,762 Words: 859 Item ID: Page 2 of 2 QANTAS QUIZ The survey carried out for the airline staff fund Qantas Super probed attitudes to investment, retirement and the impact of the financial services royal commission on attitudes to super. PROBE IMPACT The royal commission is having a limited impact on perceptions of super funds. Half of respondents did not report any impact on how they view their fund in the wake of the royal commission. 21 per cent reported a more negative view of their fund, 8 per cent had a more positive view and 21 per cent didn t have a view. NO PLAN Most Australians lack a plan to guide us towards a comfortable retirement. 42 per cent of adults have a plan of some sort and most commonly they have made this plan on their own (22 per cent). WA CLUELESS One-quarter of Australians adults did not have a plan and did not know where to start. 39% of WA respondents fell into this category. The other two groups with notably no idea where to start were people without super and the unemployed. CONFIDENCE LACKING On a scale of one to 10, the overall confidence of Australians fell from 5.1 to 4.9 between July and October. People aged have lower confidence at 4.3. SOURCE: QANTAS SUPER CSBA RETIREMENT CONFIDENCE INDEX

112 West Australian, Perth Author: Peter Warnes Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 6 Printed Size: cm² Region: WA Market: Australia ASR: AUD 3,997 Words: 456 Item ID: Page 1 of 1 Risks forced on investors Peter Warnes Head of Equities Research The market reaction to the Treasurer s decision to block CK Group s bid for APA Group was predictable, as was the bounce in the price from around $8.50, a 23 per cent discount to what CK Group was prepared to pay. My super fund is now a happy APA security holder. What I can t understand is the obsession IFM Investors has in US infrastructure. IFM manages $100 billion for 27 global pension funds, including Australian industry super funds. Infrastructure assets of APA quality are not readily available. These assets are operational and earning good returns, they are not futuristic. With big unions, the CFMEU and TWU proposing to turf banks out of superannuation perhaps infrastructure assets such as APA are a desirable replacement. Labor s proposed changes to franking will also hit investment in Australian banks. These banks are widely held by individuals and selfmanaged super funds. Due to historically low interest rates, central banks have already forced investors further out the risk curve in search of better yields. Now it would appear Labor intends to force super funds and their members to reduce exposure to fully franked dividend-paying companies, fully franked because they pay 30 per cent tax, for those paying lesser or no franking credits. This includes international equities or local real estate investment trusts and infrastructure plays. Many of the latter have higher gearing and are exposed to movements in international bond yields. Australia s welfare pool is likely to increase should the proposed changes to franking become law. WHEN FAANG FOMO GOES FONGO It was only three months ago that I asked whether the FAANGs could become dentures. As with most stocks whose valuations were stretched, quarterly earnings and outlook statements were put under the microscope. Both Netflix and Facebook disappointed in the June quarter and their share prices collapsed by 20 per cent. These two companies were the juniors of the cleverly named FAANGs, which refers to Facebook, Amazon, Amazon, Netflix and Google-owner Alphabet. Fast forward to the September quarter and the three majors stumbled, under-delivering on bullish expectations. We now have all five under meaningful pressure, with redemptions tinged with a little fear, in various ETFs now in the ascendancy. How quickly enthusiasm can evaporate. The loss in market capitalisation of the FAANGs from their 52-week high, all reached since July 2018, is just shy of US$880 billion. Add in Microsoft and IBM and the loss is US$1.01 trillion (one thousand billion). It s a lot of money and I suspect there are more losses to come with Apple and Google near bear territory, traditionally 20 per cent from their highs. Greeddriven fear of missing out (FOMO) is replaced by an anxiety-driven capital preservation mindset or fear of not getting out (FONGO).

113 West Australian, Perth Author: Rhonda Parker Section: Your Money Article type : News Item Classification : Capital City Daily : 147,676 Page: 7 Printed Size: cm² Region: WA Market: Australia ASR: AUD 13,044 Words: 767 Item ID: Page 1 of 2 Plan for the unexpected Invest now for later priceless rewards Rhonda Parker Money can t buy happiness, but it sure can help when times are tough. I think it can be said for many people that the older we get, the more we realise our happiness comes from things that money just can t buy... things such as family, close friends and our health. Sometimes it can take a family crisis, a death or onset of illness to understand just how important family and health are. A diagnosis of dementia can be such a time. However, the life-changing nature of a diagnosis of dementia means that it is important to think about your finances and how they will be impacted by your illness. It may not be the first thing you think of, or even the second or third, but setting aside some time to plan your financial future after a life-changing event such as a diagnosis of dementia is worth the effort. After all, you want to spend as much time as possible living your best life, not worrying about how you are going to pay the bills or put food on the table. The first thing to note is that we should all be planning for our later years to buffer the shocks of a lifechanging diagnosis. Prior planning is the key. But what about after a diagnosis? For a person living with dementia or any other terminal disease, financial planning is often not high on the priority list. There is always something more urgent or more important that needs your atten-