Hartleys – Month in Perspective – October 2017

HartleysAustralia’s major banks have made headlines this year, mostly for the wrong reasons. The Australian Prudential Regulation Authority (APRA) increased capital and liquidity requirements and established timetables for compliance. The more stringent capital measures are part of an ongoing process designed to protect customers and the financial system in the event of another financial crisis. These major banks are too big to fail and fail-safe measures are being put in place to ensure future financial stability.

The federal government could not pass up the opportunity to raise much needed revenue, slapping on a bank levy in the May budget. The South Australian government followed and then, after much criticism, sensibly thought better of the idea, at least for the time being.

The introduction of further macroprudential measures by APRA increased rates on and tightened credit for interest-only and investor loans to dampen the east coast housing market, particularly the Sydney market. APRA has effectively done the work of the Reserve Bank of Australia (RBA) and it seems to be having the desired effect. The targeting of specific loan categories is prudent as the Australian economy would find it difficult to absorb an interest rate increase at present.

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John Goodlad owns shares in many of the companies mentioned in this report.

Australian Expatriate Services Pty Ltd Referral Agreement Disclosure

Note that Hartley’s will remunerate Australian Expatriate Services (AES) 30% of the net brokerage and 35% of the non AUSIEX Ltd component of the Echelon administration platform (if applicable) as a referral fee per any referred client accounts. This is calculated on a monthly basis and paid on a quarterly basis from Hartley’s to AES. This fee forms part of, and is not in addition to, the standard Hartley’s fee schedule