WHO'D INVEST IN A COUNTRY LED BY BANK ROBBERS?

WHO'D INVEST IN A COUNTRY LED BY BANK ROBBERS?

The Turnbull Government is stealing $6 billion from the banks because it says they're too rich and everyone hates them anyway. Now business leaders such as Alan Joyce warn that a country led by bank robbers will scare off investors.

Which successful business will be the next to be held up?

A screen of the S&P ASX 200 for return on equity shows healthcare leading the way, with the following high performing companies: CSL with 46 per cent ROE, Cochlear 45.7, Fisher & Paykel Healthcare 30.8, Ramsay Health Care 26.9 per cent and Regis Healthcare 26, according to S&P Capital IQ.

Another obvious target is consumer discretionary which captures a diverse array of stocks, including Navitas with 49 per cent ROE, Aristocrat Leisure 35, Webjet 33, InvoCare 32.5, JB-Hi Fi 26 and Breville 20...

Information technology might also have to pay its fair share for budget repair, with the following companies leading the pack: Carsales.com.au 44 per cent ROE, Technology One 32 and Computershare 20...

A screen of the 166 companies covered by broking house CLSA found that there are 14 top performing companies with forecast ROE in 2018 in excess of 30 per cent.

The top 10 of these are Amcor 85 per cent ROE, Platinum Asset Management 54, Magellan Financial Group 52, CSL 52, Cochlear 47, A2 Milk 45, Sydney Airport 45, Aristocrat Leisure 44, Carsales.com.au 44 and Dulux Group 36.7.

 

Jesus, what an awful article.


The premise from Joyce is entirely flawed as well – a bank levy on systematically important banks recognises that they benefit both implicitly and explicitly from government support, far in excess of the 6bps or so they are being charged. I hardly think Qantas is in the firing line either – that business has managed to print 3 profits in the past five years, with terrible returns on capital employed to boot.


I do agree that the implementation of these taxes has been consistently awful but I’m starting to think that all governing parties are consistently awful, not just the Australian clowns.


I suppose the main point of the article is that Australian banks over earn on an ROE basis compared to international peers. The author then goes on to list a bunch of high ROE businesses (never mind how they got to their equity position, or leverage, or a million other things) but then doesn’t index the performance of these businesses to international peers!


Financial journalism in Australia is universally terrible. This article is no different.

 

Oh please! This campaign is similar to what the miner's did in '07.

Hopefully Turnbull has the balls to stay the course

 

Well the Rudd gov used taxpayers to guarantee the big banks at the expense of smaller banks and lenders reversing 20yrs of banking sector competition introduced by Keating.
All this while the reserve bank was bailing out their arses.

Taxpayers are owed for being guarantors, time to pay up