Australian banks

From Banking Day: The co-chief executive of lender and loan servicer Pepper Group, Patrick Tuttle, is not concerned about the lack of activity in the mortgage securitisation market this year, predicting that the first mortgage-backed issue by an Australian issuer is not far away.

The share market is one nervous Nelly again today ignoring positive overnight leads as banks can’t catch a  bid.

From Banking Day: Australia’s largest corporate trustee, Perpetual Corporate Trust, has declared that the securitisation market is “open” and expects to see a recovery in mortgage-backed securities issuance in coming months.

It’s another tough day for shares despite the overnight rally in the US as banks and miners take heat.

Ah, the action is finding folks out fast.

Here’s the inside run on the new Variant Perception report by Jonathon Tepper on the mortgagenado unfolding in Western Sydney (excerpts republished with permission): > The property bubble in Australia is now one of the biggest in history.

It’s a little bit of carnage today for shares.

Remember this: Now try this from Domainfax: A hedge-fund manager and an economist pose as a gay couple on a combined income of $125,000 and tour Sydney’s western suburbs viewing housing developments and meeting mortgage brokers for research to determine if there’s a housing bubble.

The screaming dead cat bounce of the last few days is finding resistance today as key prices weaken.

From Banking Day: State-owned Kiwibank has reported a flat half year profit as a net margin squeeze and heavy spending on a new computer system offset stronger lending growth.

Remember Kate Moloney?

The bank funding cost rocket is taking its toll on bank margins, from Banking Day: Offshore, Macquarie Bank made its first issue from its newly established covered bond program and Westpac also sold covered bonds.

We’re in full melt-up today with everything flying on the back of the OPEC non-deal. Banks are up firmly as CDS prices come off (CBA 130bps this morning) and the looming rate cuts aren’t hurting, either, as ABS numberwang goes into reverse.

From the ANZ quarterly update today: Bad debts up, largely in Asia.

The dead cat bounce continues for some today but not the banks.

The last time I took on the “Australian current account surplus (CAS)” argument in 2014 when LNG prices were soaring and there was the faintest of hopes that it might come true.

The banking and mining dead cat is bouncing again though certainly not with a whole lot of conviction.

My old sparring partner, Jonathon Shapiro at Domainfax, today takes on bank funding costs: Australia’s banks have been caught up in indiscriminate selling.

From Chris Joye: The chaos has come and it undoubtedly yields opportunity: Aussie shares delivered no return in 2015 and are down a stunning 10 per cent in the first 43 days of 2016.

The Sykesnado continues to shred shares as banks, miners and gas all fall.

From Captain Glenn in his Q&A in Parliament: “At least for our banks, to date, there’s no evidence that funding markets are impaired though a little bit of pressure on the cost.” The CBA CDS chart today is at 127bps: Rather laconic from the Captain given “pressure on cost” is impairment at some point.

Suncorp released its results this morning which included a 21% cut to the dividend: Suncorp Group Limited (Suncorp) today reported net profit after tax (NPAT) of $530 million (HY15: $631 million) for the six months to 31 December 2015. Profit after tax from business lines was $544 million (HY15: $681 million).