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Daily Dispatches – swings and roundabouts


After telling global markets last month that the Federal Reserve might consider backing away from its stimulus programme towards the end of the year – providing conditions were right – chairman Ben Bernanke has now reiterated that quantitative easing is still needed because of the weak job market and low inflation in the US.

The Sydney Morning Herald reports that markets responded favourably to Bernanke’s words, while the Aussie dollar, which has been under attack in recent weeks, retraced some of its losses to end 1.5 US stronger at 92.8 US cents.

This compares to the free fall in global markets in June when Bernanke signalled that the Fed may end bond buying later this year. At the time Bernanke’s caveat that the country’s economy needed to achieve some crucial benchmarks before that could happen  was lost in the market melee as investors scrambled to sell in a panic, leading indices to plunge dramatically around the world.

Taking a more conservative stance in his comments yesterday, Bernanke said US government spending cuts had not fully materialised in the economy, and until they did, bond buying was still needed.

“The overall message is accommodation,” Bernanke said.

Basel putting the pressure on Indian banks

Asian Banking and Finance reports that India’s banks will need to raise USD$25 billion by March 2018 in order to comply with the capital requirements of Basel III.

The country’s Ministry of Finance is asking state banks to complete plans for capital buffers and finalise strategies to raise this sum. India will put USD$2.3 billion into state-run banks by September to keep the Tier 1 capital ratio above 8%. State-run banks account for three quarters of the nation’s lending.

The banking industry is poised for a small shake-up, with 12 new private sector licenses expected to be issued early next year in a bid to improve financial inclusion. Only 50% of Indians have access to formal banking facilities.

Australia’s financial sector needs regulatory review

This is the opinion of the Reserve Bank of Australia deputy governor Guy Debelle. The Sydney Morning Herald reports that Debelle said last night that;  ”A holistic view of how the Australian and global financial system is being transformed by (regulatory changes facing the financial sector) would be very welcome and is much needed.”

Debelle was commenting on the more stringent global capital and liquidity requirements on banks to prevent another global financial crisis.

Don’t ask, don’t tell

Transparency International’s latest corruption index is out, and reveals that corruption is on the rise in many parts of the world, including Asia. But what’s happening behind the Bamboo Curtain is anyone’s guess, according to the Wall Street Journal, which reports that Transparency International doesn’t mention China once in its 48-page Global Corruption Barometer 2013. And this despite the ruling Communist Party regularly saying that official corruption is the biggest threat to the leadership’s legitimacy.

A spokeswoman for Transparency International was quoted as saying: “Every time we do this research we seek to find ways to include China, but it remains a huge challenge.”

Macquarie deal in Korea

Asian Investor reports that Macquarie has bought troubled ING Asset Management’s USD$24 billion fund in Korea as part of its bid to be able to package real-asset opportunities to local institutions. The value of the transaction has not been disclosed.

90 years young

If you were thinking that living beyond the age of 90 was a fate worse than death due to physical and mental deterioration, think again. Bloomberg reports that new research by the University of Southern Denmark in Odense, Denmark, reveals that those surviving past the age of 90 today are living longer and are mentally sharper than nonagenarians born a decade earlier.

According to the data, people born in 1915 were almost a third more likely to reach 95 than those born a decade earlier and on average they performed better on mental tests and in daily living tasks.

eFinancialCareers Survey – Tell us about your working week…the hours, the interruptions…

Conference calls, deadlines, demanding colleagues…we are conducting a short survey to get a better understanding of work habits and working cultures within the financial services industry in Hong Kong, Australia and Singapore.

It will cover topics such as working hours, annual leave and cross-time zone communication. The survey will only take five minutes to complete – and when finished you can enter a prize draw to win great prizes in each country! *

All responses will remain confidential and will be presented in aggregate form only, and the results will be posted on eFinancialCareers so you can benchmark yourself against peers at home and around the region.

Australia: https://www.research.net/s/5HQGKKP

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