Australia’s new prime minister Tony Abbot barely has his feet under his new desk, but already the business community is clamouring for reform.
The Australian reports that “leading chief executives and company directors have urged the Abbott government to commit to a new era of reform, including the urgent unwinding of key Labour policies and slashing of regulation that has ‘gone berserk’ “.
The business community is also stressing the need to expand relationships into Asia, with ANZ chief executive Mike Smith saying the country needed to continue to deepen its engagement with the region to take advantage of the Asian century.
This is like to mean significant changes to the financial services sector, reports The Age, which said that banks, wealth managers and insurers faced the first comprehensive review of the financial system in more than 15 years under a change of government.
Incoming treasurer Joe Hockey has pledged to conduct a ”root and branch” inquiry into how Australia’s financial system may need to evolve in future, and would probably examine regulation, competition, taxation, and the AU$1.6 billion superannuation pool. The plan apparently has broad support from the finance industry.
Bloomberg reports that Ping An Bank of China, which is that country’s least capitalised of 17 publicly traded lenders, will sell US$2.4 billion of shares to its controlling shareholder to bolster its capital adequacy.
Ping An joins a round of fundraising by Chinese lenders that have embarked on equity and bond sales as capital rules tighten. The sale could help Ping An Bank plug its capital shortfall and speed up branch expansion to cope with growing competition from rivals such as China Merchants Bank and Industrial Bank, says Bloomberg.
South Korea’s financial regulator is reviewing derivative sales at three foreign brokerages for compliance with the country’s regulations, reports Bloomberg.
The Financial Supervisory Service said it was conducting a partial review of the unnamed firms, but Bloomberg cited a report by MoneyToday which said the FSS was planning an industry-wide investigation into derivative product sales and began reviewing Credit Suisse, Goldman Sachs and Royal Bank of Scotland’s local units in late August.
Reuters reports that foreign executives in China are upset at a new rule allowing the authorities to hold passports for up to 15 working days to process and renew residency permits, saying it could disrupt essential business travel within China and abroad.
The increased processing time from five working days had prompted a “flood” of complaints from the expatriate community, Gary Chodorow, a Beijing-based immigration lawyer at Hong Law Offices, told Reuters.
The new rules took effect on July 1. Chinese officials have said they aim to deal with the rising flow of foreigners coming to China and to protect national security and social order.
Paul Krugman, 2008 Nobel Laureate for Economics, says China is like a giant ponzi scheme, according to Finance Asia’s coverage of Krugman’s speech at a Julius Baer conference in Bali last week.
Krugman said China was building increasing capacity “without the prospect of a corresponding and sufficient increase in domestic investor consumption”.
He also warned that South Korea was accumulating high levels of household debt due to spending on education.