Invest
Who will wear the new bank levy?
The new bank levy proposed in the 2017 federal budget is likely to pass the Senate, but the cost is unlikely to impact shareholders or customers greatly, investment experts say.
Who will wear the new bank levy?
The new bank levy proposed in the 2017 federal budget is likely to pass the Senate, but the cost is unlikely to impact shareholders or customers greatly, investment experts say.
Shaw and Partners senior partner James Gerrish told attendees at yesterday’s Market Matters Live event that the new levy is likely to pass the Senate given the current political environment.
“We’ve got a government that’s under pressure and a government that’s trying to find revenue,” Mr Gerrish said.
“If they can find it in the banks – and they couldn’t really find it in the materials space a couple of years ago – they’re going to try and do it, and it’s going to go through Parliament and it’s going to be something the banks have to wear.”
However, Mr Gerrish said the cost of this levy is unlikely to be passed fully on to customers, nor will shareholders bear the full impact of the predicted 5 per cent earnings loss. He predicted the banks will probably pass a component of the levy on to customers and wear part of it themselves.
Aitken Investment Management’s chief investment officer Charlie Aitken said the Australian banking sector usually sees a price fall of 10 per cent in May each year, and the recent fall of 13 or 14 per cent in May 2017 reflectes “the earnings downgrades that have come off the back of the bank tax”. But Mr Aitken said this should not be a major concern for investors.
“I think for everyone in this room, all you’re really worried about is the sustainability of the dividend, and I don’t think there’s anyone who’s changed the dividend forecast in any way for any of the major banks during this period,” he said.
“If you believe the dividend forecast, and I tend to because I think that they’ll be right for the next few years, then you’re simply just getting paid a higher dividend by hedge funds and other people that are having a little bit of fun. I think the greater risk in Australia is actually in healthcare sector.”
Property
Poor wage growth could impede home price growth
With wages growth at record-low levels, a property expert has warned that continuing low and flat wages could impede home price growth. ...Read more
Property
Negotiating a lower interest rate on your property loan
The banks are customer hungry, meaning they’re willing to offer increased discounts to new customers and apply these discounts to existing customer loans, a mortgage broker has said. ...Read more
Property
How to determine the real value of a property
With various factors affecting market value and pricing, can one truly predict what buyers will pay for properties? ...Read more
Property
House prices tipped to soar 20% in 2 years: Westpac
House prices in Sydney are tipped to grow by 20 per cent over the next two years, and by 18 per cent in Melbourne, as a leading economist predicts strong economic growth following the rollout of the C...Read more
Property
5 tips to unearth the next property hotspots
A property expert has bullishly claimed that property hotspots are a “complete myth” that almost guarantees buyers will pay top dollar, and has instead urged buyers to seek out the “warm spots...Read more
Property
Top 10 inland rural towns to invest in
While it’s become apparent that regional housing markets have stolen the spotlight, having outpaced their capital city counterparts in 2020, new research has shown that inland rural towns have also ...Read more
Property
Where to buy under $300k
A positively geared property with high capital growth potential does not necessarily need to carry an astronomical price tag, an expert has said, with new market entrants able to land a home for under...Read more
Property
‘Great Australian dream’ of owning a home lives on amid COVID
Most Australian investors and home buyers were largely undeterred by the events of 2020, remaining eager to push through with their investment plans, a new survey has found. ...Read more
Property
Poor wage growth could impede home price growth
With wages growth at record-low levels, a property expert has warned that continuing low and flat wages could impede home price growth. ...Read more
Property
Negotiating a lower interest rate on your property loan
The banks are customer hungry, meaning they’re willing to offer increased discounts to new customers and apply these discounts to existing customer loans, a mortgage broker has said. ...Read more
Property
How to determine the real value of a property
With various factors affecting market value and pricing, can one truly predict what buyers will pay for properties? ...Read more
Property
House prices tipped to soar 20% in 2 years: Westpac
House prices in Sydney are tipped to grow by 20 per cent over the next two years, and by 18 per cent in Melbourne, as a leading economist predicts strong economic growth following the rollout of the C...Read more
Property
5 tips to unearth the next property hotspots
A property expert has bullishly claimed that property hotspots are a “complete myth” that almost guarantees buyers will pay top dollar, and has instead urged buyers to seek out the “warm spots...Read more
Property
Top 10 inland rural towns to invest in
While it’s become apparent that regional housing markets have stolen the spotlight, having outpaced their capital city counterparts in 2020, new research has shown that inland rural towns have also ...Read more
Property
Where to buy under $300k
A positively geared property with high capital growth potential does not necessarily need to carry an astronomical price tag, an expert has said, with new market entrants able to land a home for under...Read more
Property
‘Great Australian dream’ of owning a home lives on amid COVID
Most Australian investors and home buyers were largely undeterred by the events of 2020, remaining eager to push through with their investment plans, a new survey has found. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
