Westpac

Westpac is on a real downer: predicting a serious downturn

Record high household debt levels are not sustainable, warns a leading bank economist.

At half a trillion dollars, housing and personal debt has hit 162 percent of the average household’s annual disposable income – higher than levels before the global financial crisis.

Westpac Chief Economist Dominick Stephens told Nine to Noon the decline in dairy prices was hurting the regions, but the downturn following the end of the Canterbury rebuild would be more severe than most people were prepared for.

The rebuild played a huge role in the “rock star economy” between 2012 and 2014, with the international reinsurance industry dropping $20 billion on New Zealand and the government pumping in another $10b.

As that money dried up, some business owners could find their businesses were not as robust as they thought, Mr Stephens said. Read more »

No need for government action, the market has solved it

All too often people expect the government to solve problems, if there even is a problem.

Generally they are useless at doing anything of the sort, except if it comes to collecting taxes.

People have been clamouring for the government to DO something about foreign buyers of real estate.

Today the market solved the problem for them….if it actually is a problem. I’ve never ever heard of a bank turning away profitable business. I suspect there is not problem at all which means the banks can safely decide not to do it.

Westpac and ANZ will no longer lend to overseas-based buyers of New Zealand property – with other banks expected to follow the move to shut the door on foreign investors.

The restrictions follow moves by Australian banks to stop lending to foreign buyers of property.

Westpac New Zealand has announced that from today it will no longer lend to non-resident borrowers with overseas income.

Borrowers on temporary resident visas will only be accepted if they have both a New Zealand address and a New Zealand-based income.

ANZ has also announced restrictions that will effectively shut out most non-resident, overseas-based borrowers, including restricting lending to owner-occupied properties.

Read more »

Auckland housing market finally weakens. Owners of large mortgages are puckering up for the crash

Anecdotally agents are reporting a downturn in the market with auction clearance rates as slow as 25%.

But now there is some hard data on the Auckland housing market.

The Auckland housing market’s downturn is more severe than anticipated, an economist says.

Writing in Westpac’s latest ‘Home Truths’ report, chief economist Dominick Stephens said the latest round of housing data had been revealing.

“There can now be no doubting that the erstwhile star market has suffered a fall from grace.”

According to the bank’s figures, which it seasonally adjusted from Real Estate Institute data, house sales fell 13 per cent in Auckland in November, following a 17 per cent drop in October.   Read more »

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Are your financial records safe with Xero? [UPDATED]

Rodney Hide explains that maybe your financial records won’t be safe with Xero after revealing that Xero has handed over financial records to the Official Assignee outside of the law.

Is this Xero’s VW moment?

Are your financial records safe with Xero [NZX:XRO]? Or would Xero do a Westpac and release them to state agents on simple request without warrant?

Xero CEO Rod Drury has always said safe. He again reassured NBR readers in July that Xero never releases customers’ financial records to state agents.

Mr Drury said Xero refers requests back to the customer for the information required.

“We are the custodians of our customers’ data,” Mr Drury said.

But one customer knows different. Last year Xero passed her company’s records to state agents, they had no warrant, Xero didn’t tell her, and, indeed, when she asked, Xero denied it.

Deputy Official Assignee Annemarie Foidl had asked Xero to supply the customer’s “user name” and “password” citing s171 of the Insolvency Act 2006. It wasn’t just the records she wanted but access. For a month.

We don’t know what then transpired but we do know Xero “supplied [the Official Assignee] with a report showing the credits and debits of each account connected to the subscription.”

Xero didn’t tell the customer.    Read more »

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What about respect for my privacy, Vernon?

Vernon Small has written an opinion piece at Fairfax, complaining about Westpac allegedly breaching Nicky Hager’s privacy.

The revelation Westpac handed over author Nicky Hager’s bank records to the police – without so much as a by-your-leave from the courts – should send a shiver down the spine.

It ought, too, to be a wake-up call to any other corporates out there who think their customers’ records are fair game for any authority figure that comes knocking.

They are not.

Kudos to the likes of Spark, Vodafone, Air New Zealand, Jetstar and TradeMe for recognising that – and refusing a similar request from the police.

In the case of Hager’s records – sought when the police were trying to find who hacked blogger Cameron Slater’s computer (providing the material for Hager’s book Dirty Politics) – there is more at stake than simply tracking down a potential criminal.

As the Media Freedom Committee’s Joanna Norris has pointed out, there was no suggestion Hager had committed a serious crime.

The main investigation was aimed at a third party, the self-named Rawshark. It would be bad enough if the police had come seeking the records of a member of the public but it is more chilling still when it is a journalist, who relies on being able to keep his or her sources confidential and who will on occasions interact with people “of interest to the police”.

But that should not be an excuse to access their bank, phone and travel records willy-nilly.

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National was a vote for good economic times but a vote for Labour-Greens was risking bad times

Some things in what passes as our media are set in stone despite the majority of the population thinking it’s rubbish and the latest Westpac survey should be another smack around the chops for Labour and something our fourth estate should be aware of.

Consumers voted with their wallets at the weekend.

National was a vote for good economic times but a vote for Labour-Greens was risking bad times, according to a bank survey.

The latest Westpac McDermott Miller survey of consumer confidence shows 46 per cent expected good times for the next three years under a National government.

But under a Labour-Greens government just 14 per cent would have expected good times ahead, while 40 per cent would have expected bad times.

“The stark contrast in expectations of good economic times over the next three years under the two putative governments must have been a major factor underlying the return of a National-led government,” McDermott Miller managing director Richard Miller said.   Read more »

More good news, consumer confidence at nine year high

The Labour party were hoping that all the economic indicators would get worse in election year.

Unfortunately day after day and week after week all the indicators continue to improve.

The Herald reports:

New Zealand consumer confidence rose to a nine-year high in the first quarter of this year with optimism about the economy in the year ahead approaching record levels.

The Westpac McDermott Miller Consumer Confidence Index rose to 121.7 in March, up from 120.1 in the December survey, to the highest level since the credit-fuelled boom times of 2005. A reading above 100 indicates more optimists than pessimists. A net 35 per cent of those polled expect good times for the economy over the year ahead, up from a net 27.8 per cent in the December quarter and the third-highest reading in the survey’s history.  Read more »

Kiwibank successful at keeping banking costs down? Apparently not.

One of Labour’s big claims and justifications for them deciding to launch an insurance company to compete with the other 96 insurance companies in New Zealand was that Kiwibank had done a wonderful job of keeping banking costs down.

Hmmm…the NZ Herald reports something altogether different from Labour’s claims.

New Zealand’s big four banks collectively made more than $3.5 billion of profit in the last year in another record year for the sector.

Profits grew more than 9 per cent on 2011/12 – a boost of $303 million across the ANZ, Westpac, ASB and BNZ.

John Kensington, head of financial services at KPMG, said loan growth, lower funding costs and less pressure in competing for deposits had helped boost the bank profits.

At the same time the banks had also managed to keep a tight lid on costs while holding on to their margins.   Read more »

Westpac Inspiring Kiwi Futures

Via the tipline

Looks like the Government’s bank Westpac needs to lift its game. Here’s what you can have in your retirement if you invest in their KiwiSaver scheme – destitute, living in a shotgun shack, and wash yourself in an old rusty bath.

Certainly looks like Simon Power is having an influence:

image001

 

Read more »

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Schadenfreude?

scha·den·freu·de

[shahd-n-froi-duh]

–noun
satisfaction or pleasure felt at someone else’s misfortune.
Origin: 1890–95;  < German,  equivalent to Schaden  harm + Freude  joy

Bernard Hickey, the NZ Herald and Stuff are all crowing about Mark Hotchin again. It is almost gleeful. A touch of H-Utu. This time about his name suppression and falling for a dirty Ponzi scheme back in 2o04. They are mocking a victim. They don’t mock the victims of all the other frauds out there so why mock the victim in this case?

The point of name suppression in many cases is the protection of victims, in this case Hotchin was the victim and yet the NZ Herald saw fit to seek to overturn a permanent name suppression order designed to protect victims. They did what Judge David Harvey said could not be done, that the only people who could overturn a court ordered permanent name suppression was either the victim or the court who ordered it in the first place.

It appears now that any name suppression can be validly challenged by any news organization or indeed any interested party seeking to crucify a victim.

My campaign against name suppression was for the removal of the practice for the criminals. The Herald’s actions and the gleeful vitriol and running of sensationalist headlines by financial commentators who are themselves a bunch of broken-arses by comparison. There is a old line that if you can’t do, you teach and if you can’t teach, you write about people who do. This fits the financial correspondents perfectly, who collectively probably don’t muster enough in assets to cover the amount lost by Hotchin and Finnigan in the Ponzi scheme.

Using the logic of Bernard Hickey:

Hotchin was given permanent name suppression, which has only now been lifted after a challenge from the NZHerald. Strategic Finance boss Kerry Finnigan was also duped and also got name suppression.

If only the Rotorua District Court judge James Weir hadn’t granted permanent suppression, thousands of Mum and Dad investors might not have lost over NZ$500 million in Hanover and over NZ$300 million in Strategic Finance…and counting. Thanks for that.

then none of these people should be anywhere near running a company or even investing or indeed offering advice:

Victims from big business include hedge fund manager Arki Busson and US property magnate Larry Silverstein, who is currently working to rebuild the World Trade Centre in New York.

A number of large banks, including UBS, Citigroup, Deutsche Bank and Bank of America, were also named in the filing.

From the world of politics, trusts belonging to the family of former US Secretary of State Henry Kissinger appear, as does the name of current New Jersey Senator Frank Lautenberg.

The full list of Bernie Madoff’s wealthy and famous victims is available on the internet in an easily accessible format. Is Bernard Hickey suggesting that none of those people should ever run a company or give investment advice and all should also be a target of derision for having the temerity to fall for a complex and elaborate long-term fraud?

In a Ponzi scheme, the Bank cops a flogging too, and are essentially part of the fraud. I hope that Bernard’s bank isn’t the same one as the bank used by Papple and West, Westpac. I note that Bernard Hickey has all the Westpac investment products listed on interest.co.nz….given his new position shouldn’t he really be recommending to his readers that, since they participated and fell for the Ponzi scheme themselves then investors in Westpac would be best to take their money elsewhere.

Then again, some already did that when they walked out of the country with $10 million of Westpac’s cash. Funny thing is, I didn’t see Bernard Hickey telling Westpac customers to stop investing in the bank when they couldn’t keep track of $10 million. So long as Westpac keeps the cheques coming to interest.co.nz then Bernard will stay mum.

The logical conclusion of Hickey’s farcical suggestions and “analysis” is that anyone, and I mean anyone, who has had an accountant nick cash from their firm, handed over funds to a Nigerian 419 fraud, or “invested” in a Ponzi scheme, or indeed thought Amway was a path to success, should be barred from running a company.

What is worse though is the history of the Herald’s involvement in this case. They clearly, back in 2004, used Hotchin and Finnigan as a confidential source for their story:

One prominent company director told the court he did not want the public to know he was “conned” for more than half-a-million dollars.

The man, who has been granted name suppression by Judge James Weir, said he was advised to apply for suppression because it would be better if the Papples and West were not publicly associated with his companies.

It was revealed in court that the man had been a director of 71 companies, including a prominent finance company, although he said he had recently moved to Australia and had resigned from a number of directorships.

It was important for him not to be connected with the Papples and West, as he had been “duped into doing an investment with people who conned me for a lot of money”, he said. “I don’t want to make that public.”

The man had told the court he invested $561,066 with the trio.

He received a payment of $120,000, followed by a further three sums totalling $336,000.

The Herald has known about this for 6 years and they shamelessly used the confidential information for their story then used that information 6 years later to over-turn a name suppression case. People should be very wary of providing confidential information to a Herald journalist from now on, they will turn on you and cut your heart out just to sell papers. They will betray a confidence to justify a taudry headline.

Not only that during this whole time they ran Hanover ads in their paper, and on their website,. They have performed the business equivalent of raping the victim all over again except they did it to sell papers.

Bernard Hickey isn’t much better, he too took advertising revenue from Hanover. Did he know about this all along? Remember Bernard Hickey still writes for the Herald.

In the interests of fairness, surely the Herald and Bernard Hickey should pay back all the “dirty Hanover cash” they took while sitting on this information for 6 years. If the investors should have been told back then, then their cash for advertising is just as tainted as anyone elses.

To get back to the name suppression issue, the wonder is that the Herald isn’t in court seeking the overturning of every person’s name suppression but then a great many of those people won’t sell tell many papers, but Mark Hotchin’s name does.

Bernard Hickey and other financial media might like to think and enjoy the schadenfreude but they should really hang their heads in shame at their utter hypocrisy and breach of their own ethics and standards that they hold so dear as the reason why they are superior to bloggers. If they had even a modicum of decency they would apologise and pay back all the filthy loot they took in advertising revenue and related puff pieces at the time.

If I was Mark Hotchin, or even one of his advisors, I would be laying a complaint with the Press Council for breaches of ethics.