WA to surprise with surplus; Retail sales, exports lift recovery hopes; Kelly cautious on business lending; BHP waits on contracts, bets on new price system; Crackdown on margin lenders
WA to surprise with surplus
The West Australian government will deliver a better-than-expected surplus of about $400 million in next week's 2009-10 budget even as the state's economy contracts for the first time in 15 years. The Fin Review
Retail sales, exports lift recovery hopes
Australia may yet avoid recession after figures yesterday showed cash-flushed shoppers returning to the nation's malls and a huge trade surplus fuelled by farming and mining. The West
Kelly cautious on business lending
Westpac has stowed away $4.5 billion to cover an expected blowout on loan defaults over the next 18 months as mortgage and business borrowers are crunched by the recession. Herald Sun
BHP waits on contracts, bets on new price system
BHP Billiton's iron ore chief Ian Ashby has played down suggestions there may be no benchmark iron ore price set this year, saying he expects a contract price "of some description" to be settled. The West
Crackdown on margin lenders
Margin lenders must be licensed, disclose fees and commissions and allow investors to receive margin calls by SMS or email before their shares are sold, under tough federal laws to regulate the $30 billion industry to be released today. The Fin Review
THE WEST AUSTRALIAN:
Page 3: Australia may yet avoid recession after figures yesterday showed cash-flushed shoppers returning to the nation's malls and a huge trade surplus fuelled by farming and mining.
Page 6: West Coast has confirmed its status as the AFL's premier financial powerhouse, leading the league in net revenue and profit last year despite the worst on-field performance in the club's history.
Page 9: The $20 million sale of a sprawling Dalkeith mansion, believed to be one of the biggest property purchases in Perth's history, has defied the housing slump in the western suburbs.
Page 12: The federal government will halve the amount high-earners can squirrel away in their superannuation funds at the preferential tax rate of 15 cents in the budget next week.
Page 15: Tourism industry leaders and the state government have backed plans for a marina at Ocean Reef, saying it would be a major coastal destination for the metropolitan area that would be a drawcard for locals and visitors.
Business: Westpac chief executive Gail Kelly has warned that a rebound from the recession is likely to be a "slow haul" with Australia's economy set to deteriorate further into next year.
BHP Billiton's iron ore chief Ian Ashby has played down suggestions there may be no benchmark iron ore price set this year, saying he expects a contract price "of some description" to be settled.
Administrators and receivers for collapsed copper miner Matrix Metals have reached a settlement in the $19 million row that had all but stalled the asset sale process in litigation.
WA's small businesses are doing it tough and fear things will get worse, according to the Independent Retailers Organisation.
The corporate watchdog's case against iron ore billionaire Andrew Forrest was overblown and an attack against a visionary businessman, a court was told yesterday.
Private equity-backed biomass producer Plantation Energy Australia has tapped into the growing European market for so-called green energy by securing a $70 million, three-year deal to supply its compressed biomass fuel pellets to a Belgium-based power company.
A buoyant Mark McInnes has hinted that David Jones is preparing for an end to the downturn, with the retailer increasing staff hours and inventory despite a 10.8 per cent fall in sales for the April quarter.
Shares in West Australian Newspapers Holdings plunged 10 per cent yesterday as brokers reacted to Tuesday's lower-than-expected March quarter profit, which sparked renewed concern about the advertising outlook.
Macquarie Group tipped more than $1.1 billion into its stand-alone banking arm over the past year, helping the lending unit to pump up capital reserves as part of efforts to reassure investors and regulators in the face of the global credit squeeze.
Investors scampered to the sidelines yesterday when market apprehension ahead of the impending US bank stress test results sent US index futures tumbling, leaving the S&P-ASX 200 down 23.3 points, to 3,867.1.
THE AUSTRALIAN FINANCIAL REVIEW:
Page 1: The federal government has allowed the Australian Taxation Office to spend an extra $80 million this year as it steps up its compliance efforts in a bid to offset a $200 billion decline in revenue that threatens to keep the national budget in deficit for several years.
Westpac Banking Corp chief executive Gail Kelly has warned that bad loans will trouble Australia's biggest lender until 2010, after capping off a solid reporting period for the top banks that showed gains in market share marred by a spike in provisions against bad debts.
Leading chairmen and executives fear the multi-billion-dollar infrastructure program outlined by the Rudd government could be undermined unless it is accompanied by sweeping regulatory reforms.
Page 3: Margin lenders must be licensed, disclose fees and commissions and allow investors to receive margin calls by SMS or email before their shares are sold, under tough federal laws to regulate the $30 billion industry to be released today.
Page 5: Surprisingly string retail sales and a large trade surplus have raised the possibility the economy could avoid a sharp contraction in the March quarter, defying the worst global downturn in more than 60 years.
The federal government's fiscal stimulus spending has been an unexpected boon for shopping centre food retailers.
Page 10: The West Australian government will deliver a better-than-expected surplus of about $400 million in next week's 2009-10 budget even as the state's economy contracts for the first time in 15 years.
THE AUSTRALIAN:
Page 1: The financial pain in next week's budget will be spread among all Australians after Kevin Rudd concluded taxing the rich alone would barely make an impact in stemming the dramatic collapse in government revenue caused by the global slowdown.
It's what Kerry Packer did to cricket and Rupert Murdoch did to rugby league. Only this time it's the musty world of Melbourne's establishment clubs that faces its biggest shake-up in more than 100 years.
Page 2: The union representing forestry workers has accused the environmental movement of attempting to blackmail banks to deny finance to the proposed $2.2 billion Gunns pulp mill project in Tasmania.
Page 4: A massive surge in exports to China has allowed Australia to shrug off the downturn in global trade and report its second-best trade surplus.
West Australian Premier Colin Barnett has accused the Rudd government of reckless financial management, saying it spent too much money too quickly and was paying the price.
Page 5: Malcolm Turnbull has guaranteed a coalition government will return the federal budget to surplus more quickly than Labor, accusing Kevin Rudd of concealing his poor economic management behind the excuse of the global recession.
Page 6: The $15.5 billion export education boom continues to defy the global recession, showing record annual growth of 20.8 per cent in the number of international students in universities and vocational colleges for the key March enrolment period.
Page 7: The world's largest medical publisher, Elsevier, has expressed embarrassment at its role in a deceptive marketing ploy by the giant drug company Merck after it was revealed in a Melbourne court.
Business: Westpac has predicted the housing sector will lead the economy out of its rapid downward spiral in the second half of next year, while laying claim to the industry's strongest buffer against a continuing wave of bad debts.
The murky world of over-the-counter derivatives trading, or shadow banking, is headed for major reform as a result of international regulators issuing controversial recommendations to avoid more financial collapses.
Regulators have told Bank of America that the company needs to raise about $US35 billion ($47 billion) in capital based on results of the government's stress tests, according to sources.
Banks in Australia could face tougher global regulation of capital requirements even though they are ultra-conservative compared with their international peers.
Oil and gas producer Santos says early attempts to merge its Gladstone liquefied natural gas project with the Origin or BG projects are proving difficult.
Westpac chief executive Gail Kelly has called a halt to the controversial practice of offshoring banking-industry jobs to countries offering cheaper labour.
Department store group David Jones has reported a pickup in sales during April as the federal government's stimulus package began arriving in shoppers' mailboxes.
The Rudd government will give the $21 billion margin lending industry three weeks to digest a proposed overhaul of the regulatory and legislative regime in a bid to reduce the number of people losing their homes from margin calls.
Allco Finance Group receivers Steve Sherman and Peter Gothard have managed to sell the collapsed leasing group's all-important aviation business despite significant complications and at least two months of delays created by two former Allco executives, David Veal and John Kinghorn.
Construction and building materials company Boral has offloaded its 17.6 per cent stake in cement maker Adelaide Brighton for $210 million to reduce its high bank debt and gearing.
Small and medium-sized firms in NSW have been suffering the worst business conditions in the country since the global economic crisis tightened its grip, the latest National Australia Bank survey has found.
