Banking & Finance News

Australian insurer Suncorp relied on data including a suburb's Muslim population and Greek ancestry to determine motor and home insurance premiums, according to reports this week.

Legal experts warned the practice risks breaching anti-discrimination laws, as exemptions do not cover race or religion. A Suncorp spokesperson said the company sets premiums using risks associated with customers and location, and has since stopped using religious and ethnic data, Elias Visontay reports for SMH business (AU).

Capital markets operator NZX appointed financial services executive Hishaam Mirza as its new chief executive on Tuesday.

Mirza joins the exchange following a 14-year tenure at NZ Super, where he recently headed direct investments. He takes over from acting chief executive Graham Law on 14 September, according to RNZ.

NZX chair John McMahon said in a statement that Mirza was selected following a global search to lead the business. The exchange has been without a permanent chief executive since May, when Mark Peterson stepped down from the role, RNZ business (NZ) reports.

Buy now pay later spending in Australia grew just $1.5 billion in 2025, down from $3 billion annual growth in the late 2010s, as new credit regulations and slowing customer acquisition reshape the sector, the Reserve Bank reports.

New BNPL account applications fell 35% in the three months to June 2026 from a year earlier, according to credit agency Equifax. At least eight platforms have exited Australia since 2022, leaving four major operators: Afterpay with 4.5 million customers, and PayPal, Klarna and Zip with about 2 million each. Zip will leave New Zealand on Monday.

The slowdown follows 2025 laws that required BNPL companies to perform credit checks and report accounts to credit agencies, removing the instant approvals that were their main draw. "Once it became more regulated and had more friction, then I think people changed," said Kevin James, analyst at Equifax. Australians spent 20 times more on credit cards than BNPL last year, Luca Ittimani reports for Guardian business.

Westpac director Michael Ullmer told a parliamentary committee that the bank's board was not informed of KPMG whistleblower allegations until Labor Senator Deborah O'Neill read them out in parliament in March, despite Peter Nash, a fellow director and former KPMG partner, being warned earlier.

Ullmer said Nash did not share the allegations with other board members. Nash resigned last month after it emerged he had stayed at the home of KPMG chairman Martin Sheppard while the firm was pitching for Westpac's $25 million-a-year audit contract, a breach of tender protocols the director called a clear failure.

Westpac's general counsel did not receive a comprehensive explanation of the allegations until May 13, Ullmer told the inquiry. The director said the gradual disclosure of information about the matter had been "one of the most challenging aspects" as the board discovered the scope of the breach over time.

Former RBA governor Glenn Stevens and Optus executives are also being called before the parliamentary inquiry into KPMG's misuse of confidential client information, Colin Kruger reports for SMH business (AU).

Brazilian digital lender Nu Holdings reported net profit of $1.06 billion for the April-June quarter, surpassing the $967.2 million analyst estimate and marking the first time the company has topped $1 billion in a single quarter. Net revenue rose 39 per cent to $5.88 billion, above the $5.60 billion consensus, while its credit portfolio grew 37 per cent year-on-year to $39.4 billion, Reuters reports.

Shares jumped 9 per cent in extended trading to about $15.25 each. The profit growth was driven by higher revenue and an improvement in risk-adjusted net interest margin, Chief Financial Officer Rob Livingston told Reuters. Early delinquency rates rose 0.3 percentage point year-on-year to 4.8 per cent but fell from 5 per cent in the first quarter.

Cost of credit, which had weighed on shares the previous quarter, declined to $1.69 billion from $1.79 billion but remained 60 per cent higher than a year earlier. Livingston said Nubank benefited from Brazil's Desenrola debt-refinancing program launched this year, though he said improvement would have occurred even without it, accounting for only about 5 per cent of the bank's total cost of credit, Channel NewsAsia business reports.

Bank of America said on Wednesday it plans to deploy $250 billion by July 2027 to finance U.S. digital and infrastructure projects through its "Critical Infrastructure Finance Initiative," targeting data centers, renewable energy and transportation. The 18-month program will provide primary market lending, investments and capital markets services, the Wall Street bank said.

The move reflects major financial institutions capitalizing on rising demand for AI data center and energy infrastructure upgrades. JPMorgan Chase and Morgan Stanley have announced similar initiatives, committing $1.5 trillion and roughly $1.5 trillion respectively to technology and infrastructure financing, Channel NewsAsia business reports.

Cash net profit after tax increased 7% to $11 billion for the year ended 30 June 2026, the bank said in its full-year results. Pre-provision profit rose 6% to $16.5 billion and return on equity lifted to 14.0%, supported by customer and volume growth with the underlying net interest margin broadly stable.

CBA grew at or above system rates across all five core domestic product categories — home lending, business lending, consumer finance, household deposits and business deposits — marking the first time the bank has achieved this and the first time any major Australian bank has done so in 15 years. Operating income increased 6%, while investment spend rose 6% to $2.4 billion as the bank continued to invest in customer service, technology and fraud prevention.

Loan impairment expense increased 9% to $788 million, reflecting portfolio growth and cost-of-living pressures. Home loan arrears rose to 0.73% and personal loan arrears to 1.72%, though provision coverage remained strong at 1.53% of credit risk weighted assets, commbank.com.au reports.

South Korea's central bank will raise interest rates further to combat persistent inflation, the outgoing deputy governor said on Tuesday. "Unless there is an extraordinary shock or an extraordinary factor, the possibility of an additional rate hike is high," Bank of Korea Senior Deputy Governor Ryoo Sang-dai said at a press conference as his three-year term ends on August 20.

The central bank raised rates for the first time in three-and-a-half years last month and has signalled more increases to come. Ryoo said the bank is more concerned about demand-driven inflation from the domestic economic recovery than supply shocks, and that export and credit card spending data will shape the policy decision at the August 27 meeting.

Inflation softened to a three-month low in July on falling oil prices, but policymakers remain wary of upward pressures. Markets have not ruled out a back-to-back rate hike this month, Reuters reports.

The Australian Small Business Ombudsman says digital platform account shutdowns have become its fastest-growing complaint category, quadrupling to 48.3 per cent of new cases in the June quarter from 12 per cent a year earlier. Small businesses report their accounts being switched off entirely by algorithms with no warning or human oversight, cutting them off from customer details and photographs within seconds.

US inventor Jack Nekhala has lodged a complaint with the Australian Competition and Consumer Commission against Amazon after his seller account was deactivated on April 11, 2025. His Bed Scrunchie business turned over about $US6 million ($8.5 million) a year almost entirely through Amazon. Nekhala says Amazon provided no Australian investigation or notice and he is asking the ACCC to establish whether anyone in Australia assessed the decision or if it automatically followed a US block.

Amazon said the account was permanently suspended following multiple enforcement actions for policy violations, without providing further details, David Swan reports for SMH business (AU).

The Australian dollar is rising against the Japanese yen as it weakens to levels unseen in decades, boosting the value of holidays to Japan for Australian travellers. In late July, the US and Japanese governments jointly intervened in currency markets to prop up the yen after it hit its lowest level against the US dollar since 1986, but the support proved temporary.

Japan's weak currency makes its exports cheaper and more competitive globally, helping drive a record current account surplus this year, but increases the cost of imports including food and energy. The US government is concerned that a weaker yen makes Japanese goods more competitive against American manufactures at a time the Trump administration is pushing tariffs and domestic manufacturing growth, Rand Low reports for The Conversation.

ASB, New Zealand's largest Australian-owned bank, reported a full-year profit of NZ$1.3 billion for the year ended June, down 2 percent from the previous year, with a NZ$135 million class action settlement contributing to a 16 percent rise in operating costs to NZ$1.65 billion, RNZ reports.

Operating expenses also climbed due to higher staff costs, technology spending and increased bad debt provisions, which rose 30 percent to NZ$78 million. Net interest income grew 8 percent to NZ$3.14 billion. Home lending increased 6 percent to NZ$84.5 billion and business and rural lending rose 6 percent to NZ$36.2 billion.

ASB chief executive Vittoria Shortt attributed the challenging result to economic disruption from Middle East conflict and rising inflation. "The economic recovery has been very stop-start," she said, adding that ASB customers had weathered conditions well, with fewer households struggling to repay loans, RNZ business (NZ) reports.

Contact Energy's full-year net profit rose nearly $100 million to $423 million, but CEO Mike Fuge told RNZ that potential price cuts for residential customers remain uncertain despite increased renewable generation. Lines and transmission charges are forecast to continue rising, he said, meaning any reduction in the energy component of bills would be offset by other costs.

The company is also pursuing a partnership with data centre operator CDC to build a 250-megawatt facility near Contact's retired Taranaki gas plant, which could eventually demand about 350MW of electricity once ancillary systems are included. Fuge said New Zealand's renewable energy abundance, fibre connectivity and skilled workforce made it competitive with Nordic countries for data centre investment, rnz.co.nz reports.

Westpac said it is now blocking more than $40 million annually in unwanted subscription payments, up from $25 million last year, as overseas websites continue to ensnare shoppers with hidden ongoing charges.

The bank's head of customer care operations, Peter Barnes, said the businesses involved often disclose terms in fine print but make them deliberately hard to find. "In our view, their money-making model is unethical," he said. Most customers discover the problem only when checking their statements, he added, with AI meal plans and training programmes among the common traps.

Barnes said the operators "move around very quickly and they bounce from jurisdiction to jurisdiction" and some fraudsters pose as New Zealand-based to appear trustworthy. He urged shoppers to monitor statements closely and watch for pressure to act quickly on discounts, RNZ business (NZ) reports.

New Zealand's largest banks have sharply reduced their ATM networks, with ANZ cutting 85 machines in two years and Westpac removing 54, according to RNZ reporting. Bank-owned ATMs have dropped 32 percent over the past decade, while total bank branches have fallen 40 percent, the Reserve Bank said.

The banks say they are responding to falling cash use — only 1.5 percent of customer transactions now happen at ATMs — but consumer advocates warn that 40 percent of New Zealanders still use cash for everyday purchases. The Reserve Bank is preparing minimum standards for cash access, proposing that 95 percent of urban residents should have walking-distance access to free withdrawals, at an estimated cost to banks of $100 million a year, RNZ business (NZ) reports.

The S&P 500 fell 0.1 per cent in mid-afternoon trade after flipping between small gains and losses, with the Dow Jones down 133 points, or 0.3 per cent, and the Nasdaq composite 0.4 per cent lower, according to the Associated Press. Brent crude rose 4.7 per cent to US$87.50 on uncertainty about when the Strait of Hormuz could reopen, swinging between US$72 and US$102 over the past month as hopes for a US-Iran agreement have risen and fallen.

The Australian sharemarket is set to edge lower, with futures pointing to a loss of 6 points, or 0.1 per cent at the open, ahead of the Reserve Bank's interest rates decision at 2.30pm AEST. Money markets and economists are in near-unanimous agreement the RBA will hold the cash rate steady at 4.35 per cent. The Australian dollar was trading at US70.56¢.

Technology stocks weighed on the US market, with Nvidia falling 2.5 per cent, Apple down 2 per cent and Intel sliding 3.4 per cent after announcing it may sell US$15 billion of stock to fund artificial-intelligence investments, Stan Choe reports for SMH business (AU).

Australia's financial regulator has accused motor insurers of failing to explain why car insurance premiums have jumped 50 per cent in six years, finding that customers often pay a "loyalty tax" without understanding the reasons for increases.

ASIC's survey of 2000 customers found 31 per cent secured lower premiums simply by calling their insurer to push back, yet 67 per cent renewed with the same provider without shopping around. The regulator examined renewal documents from AAMI, Suncorp, Allianz, Territory Insurance, NRMA, RACV, RAC (WA) and Youi — 72 per cent of the market — and found insurers buried generic explanations for price hikes in supplementary documents rather than making them clear upfront.

"There is no upside to loyalty," ASIC commissioner Alan Kirkland said, noting that 54 per cent of customers were unaware insurers could reduce premiums by up to 20 per cent if they paid annually instead of in instalments. ASIC has threatened enforcement action against insurers distributing inaccurate or misleading renewal notices, Elias Visontay reports for SMH business (AU).

The Philippines' gross international reserves fell 1.2 percent to $103.4 billion at the end of July, the lowest level since January 2025, the central bank said Friday. The decline reflected government debt repayment and central bank intervention to manage peso volatility.

Holdings of foreign debt securities, which make up the bulk of reserves, fell 6.5 percent to $67.3 billion, while foreign-exchange holdings dropped to $1.8 billion, a two-month low. The central bank said the national government withdrew dollars from its BSP deposits to meet external debt obligations, Inquirer business (PH) reports.

The US has imposed sanctions on a Dubai-based cryptocurrency exchange for facilitating financial transactions for Iran's Islamic Revolutionary Guard Corps, according to Reuters reporting.

The action follows an investigation by Reuters into how crypto platforms have been used to circumvent Western financial restrictions on Iranian military and intelligence bodies, Channel NewsAsia business reports.

Loans to micro, small and medium enterprises fell to 4.48 percent of the local banking sector's total portfolio in the second quarter, down from 4.53 percent in the prior quarter, according to data from the Bangko Sentral ng Pilipinas reported by Inquirer Business. The share remains far below a former 10 percent target and a mandated 8 percent allocation for micro and small firms that expired in 2018.

In peso terms, P572.74 billion of the banking sector's P12.8-trillion loan portfolio went to MSMEs, slightly below the P573.82 billion in the first quarter. Banks have cited structural constraints: MSMEs lack acceptable collateral, have unstable cash flows and limited credit histories, pushing many to borrow from informal sources at high rates.

"The story here is not a lack of liquidity but a lack of bankable borrowers," said Jonathan Ravelas, senior adviser at Reyes Tacandong & Co. "Until constraints on credit information, collateral and financial records are addressed, MSME lending will continue to lag overall loan growth."

MSMEs make up 99 percent of Philippine business establishments and provide around 63 percent of employment, Inquirer business (PH) reports.

Singapore bank employees with stakes in company share purchase plans have seen significant gains as OCBC, DBS and UOB stocks hit record highs, the Straits Times reports. ESPPs allow workers to buy discounted shares through monthly salary deductions, with some plans including employer matching contributions and dividend payouts over time.

Deutsche Bank and KBC Group have frozen some Singapore bank accounts belonging to Radiant World, the iron ore trading house, while other lenders have suspended credit lines, according to people familiar with the matter. The moves follow Bloomberg's report last week that commodity traders had stopped dealing with Radiant World over concerns it provided banks with falsified documents about iron ore trades.

Rio Tinto Group and Vale, the world's two largest iron ore miners, have removed Radiant World from their approved customer lists for spot market sales. Arab Bank Switzerland has stopped issuing new letters of credit for the trading house's shipments, and ICBC Standard Bank has suspended repo financing, according to sources.

Radiant World said in a statement it "remains well capitalised with healthy liquidity, supported by a consortium of long-standing banking partners" and continues to meet its obligations. The company has previously denied wrongdoing, saying it "conducts its business to the highest commercial and legal standards." The Straits Times reports.

OCBC Bank's second-quarter net profit grew 22 per cent to $2.22 billion, beating analyst forecasts of $1.91 billion, as strong non-interest income from wealth management offset a 1 per cent decline in net interest income amid lower interest rates, the Straits Times reports. The bank declared an interim dividend of 47 cents per share for the first half of 2026, up from 41 cents a year ago, with the payout estimated at $2.11 billion, or about 50 per cent of first-half net profit of $4.19 billion.

Non-interest income rose 51 per cent to $1.91 billion, driven by a 28 per cent jump in fees led by wealth management, an 85 per cent surge in trading income and a 68 per cent rise in insurance income. Net interest margin fell to 1.70 per cent from 1.92 per cent a year earlier.

OCBC raised its 2026 loan growth guidance to high-single-digit to low-double-digit growth from mid-single digits, and now expects total income to grow rather than remain stable. The bank is hiring 600 additional relationship managers over the next three years and will progressively launch what it describes as South-east Asia's first AI-native mobile banking app.

Bank of New Zealand has increased its standard one-year home loan rate by 20 basis points to 4.99 percent, with the 18-month rate rising by the same margin to 5.29 percent. Two- and three-year rates will lift by 16 basis points and four-year rates by six basis points, all to 5.45 percent. The move follows a similar increase by ANZ, which cited rising wholesale rates.

Infometrics chief forecaster Gareth Kiernan said financial markets have already priced in the official cash rate reaching 3 percent or slightly above by the end of this year and 3.5 percent by mid-2027. "You might get another 10 basis points, maybe slightly more on the one-year rate before the end of the year but I don't see a great deal of pressure on the one-year rates past that," Kiernan said. He said it was unlikely home loan rates would return to the 6 percent range, RNZ business (NZ) reports.

Australia's share market closed at a record 9,227 points, up 0.9 per cent, as pressure eased on the Japanese yen following intervention, ABC reports. The intraday high reached 9,230 points. Mining gained 3.3 per cent but energy losses limited further index gains, with traders also pricing in hopes of a US-Iran deal to reopen the Strait of Hormuz.

Top performers included Neuren Pharmaceuticals (up 16.28 per cent to $21.64), 4DMedical (up 9.77 per cent to $4.72) and IperionX (up 8.95 per cent to $3.41). Woodside Energy fell 3.55 per cent to $31.78, Domino's Pizza dropped 3.16 per cent to $19.29, and Karoon Energy slid 2.87 per cent to $1.69, David Chau reports for ABC business (AU).

Apple Pay is now available in the Philippines, Visa and Mastercard said on Tuesday, allowing eligible debit and credit cardholders to add their cards to the service on iPhone, Apple Watch, iPad and Mac devices.

Users can make contactless payments by double-clicking the side button on their iPhone or Apple Watch, authenticating the transaction and holding the device near a compatible payment terminal. The launch comes nearly a year after Google Pay entered the Philippine market, according to Inquirer, Inquirer business (PH) reports.

UOB is divesting its asset management business to Allianz Global Investors for $555 million, the Singapore lender said on Aug 5. The sale is expected to generate a pre-tax gain of about $330 million and will increase UOB's capital ratio by an estimated 14 basis points, according to the bank.

UOB operates the asset management arm across eight Asian markets and will retain a long-term distribution partnership with AllianzGI to offer clients investment products. All 500 UOB Asset Management employees will transfer to AllianzGI, which has committed to maintaining their employment. The transaction is expected to close in 2027, subject to regulatory approval, The Straits Times reports.