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Remember banking sector’s virtues, former PM pleads
Bank stocks are poised to fall in coming weeks as the royal commission’s scrutiny circles back, but former prime minister John Howard has called for consideration of the sector’s virtues.
Remember banking sector’s virtues, former PM pleads
Bank stocks are poised to fall in coming weeks as the royal commission’s scrutiny circles back, but former prime minister John Howard has called for consideration of the sector’s virtues.

According to Dale Gillham, chief analyst at Wealth Within, reporting season might have a positive effect on the Australian market, but bank performance could add a sourer note.
“Bank stocks are more likely to fall in coming weeks as the royal commission probe continues into superannuation and puts banks under the microscope again,” he said.
“On a brighter note, Commonwealth Bank of Australia (CBA) and Suncorp Group Limited (SUN), were two of the standout companies to release their results last week.
“Interestingly, CBA’s $700 million AUSTRAC fine didn’t stop CBA from announcing a profit of $9,375 million, however, the result was down by around 4 per cent on last year. Despite the news, the stock rose by around 3.5 per cent this week.”

Mr Gillham said plans to sell the attached wealth management divisions could “pave the way” for a capital return for shareholders.
John Howard: ‘Bear in mind the stability … made by the Australian banking system’
His comments coincide with those made by former prime minister John Howard in Brisbane this week.
Speaking at Loan Market’s Connect 2018 conference, Mr Howard said it’s important to remember the stability the banking sector has brought, Nest Egg sister site Mortgage Business reported.
“The Australian financial system came through the global financial crisis far better and in far better shape than the financial system of most other countries,” Mr Howard said.
“I don’t pre-judge anything and I certainly don’t condone improper, unfair, or dishonest behaviour. But I do hope that in the overall judgment and reflection that is made of the Australian banking system, which is so important to your industry, that you bear in mind the stability and the contribution that was made by the Australian banking system – in no small measure due to the prudential regulation that was put in place by my government in the early part of this century.
“I hope that it’s something that is kept in mind for a balanced judgement.”
Mr Gillham said banks, despite the probable hurdles, will continue to generate multibillion-dollar profits, paying dividends at market or above and as such remaining an attractive investment.
At the same time, he said AMP investors will probably continue evaluating their loyalty with AMP falling about 50 per cent from a February 2015 high of around $7, with further risk in the future.
“That said, in the coming months, AMP may trade towards $4 as the market has largely factored in negative news about company profits and findings from the royal commission. How it behaves in the last quarter of 2018 will shed light on direction in 2019,” Mr Gillham said.

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