Oceania

Insolvency practitioners could face fines of up to $75,000 if they don't report serious issues in failed businesses, if proposed legislative amendments go ahead, Radio New Zealand reported. The penalties were one idea floated in a Supplementary Order Paper on the proposed amendments to the Insolvency Practitioners Bill. The legislation aimed to get rid of errant behaviour by so-called friendly liquidators, administrators and receivers who did not give all creditors a fair go. Submissions on the bill close on Friday.
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One of the longest stalemates in Australian corporate history could be nearing a resolution. Vodafone Hutchison Australia Pty, the joint venture between Vodafone Plc and a unit of Victor Li’s CK Hutchison Holdings Ltd. that runs the nation’s third-largest mobile network, is in talks to merge with homegrown challenger TPG Telecom Ltd., the companies said in statements Wednesday.
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Wesfarmers’ annual profit halved as a result of more than A$1bn in write-offs linked to the sale of Homebase, the Australian retail-to-industrials conglomerate’s disastrous foray into the UK DIY market, the Financial Times reported. The company said on Wednesday that full-year profit for the 12 months through June fell 58 per cent to A$1.2bn (US$861.4m). But it posted strong results from its core Australia and New Zealand businesses, with profit at its continuing operations rising 5.2 per cent to A$2.9bn, slightly ahead of consensus forecasts.
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JB Hi-Fi expects to see another year of declining revenues on this side of the Tasman as the ASX-listed discount consumer electronics retailer attempts to drive profitability in its New Zealand unit, The New Zealand Herald reported. The local division of the Melbourne-based company widened its loss before interest and tax to $2.9 million in the 12 months ended June 30 from an ebit-loss $2.7 million a year earlier. Not only did margins shrink, but revenue dipped 1.1 per cent to $231.5 million with the closure of one store and exit from whiteware goods.
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Hedge funds have found a new way to profit from the sorry state of Australia’s housing market: playing off how much poorer consumers feel as their home values decline, Bloomberg News reported. Managers including Totus Capital and Sydney’s Regal Funds Management are heaping bearish wagers on companies from JB Hi-Fi Ltd. to Harvey Norman Holdings Ltd., betting discretionary retail stocks will wobble as the country’s decades-long property boom goes into reverse and people shop less.
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Australia’s Westpac Banking Corp said on Thursday it would disburse A$100 million ($74.2 million) in cheap loans to farmers as a record dry spell hits parts of the nation, while the country’s lenders fight to regain public trust amidst an ongoing misconduct inquiry, Reuters reported. The drought in Australia’s east, one of the worst on record, is impacting every area of rural life, often with global trade and price implications. Already many cattle graziers are being forced to sell stock they can no longer feed.
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Almost one million Australian homeowners are set to default on their mortgages in the coming months, an independent analyst warns. Digital Finance Analytics principal Martin North explained that if the big four banks do go ahead and increase their standard variable rates by as little as 0.15 percentage points over the next few months, homeowners could default, the Daily Mail reported. A number of Australian banks have already begun the process of raising their interest rates, ABC News reported.
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The liquidators of Bella Vista Homes have just $28 with which to pay more than $4 million to creditors – unless they can recover money from two former directors and a series of related company transactions, The New Zealand Herald reported. Insolvency practitioners Rhys Cain and Rees Logan released their first report on Wednesday and outlined their plans to recover the millions owed. They have issued a letter of demand to former Bella Vista director and shareholder Danny Cancian, seeking to recover funds from his overdrawn shareholder current account.
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Telstra Corp. plans to cut 8,000 jobs, sell assets and potentially spin off a new infrastructure business in a make-or-break attempt to fend off competition, Bloomberg News reported. The stock tumbled. Australia’s former phone monopoly, which has lost more than half its market value since early 2015, said it will almost double its cost-cutting program. An asset carve-off will raise as much as to A$2 billion, and one in four executive and middle management roles will go over the the next three years. “We are now at a tipping point,” Chief Executive Officer Andrew Penn said in a statement.
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Australia left its key interest rate unchanged at a record low Tuesday after the key unemployment metric edged higher, Bloomberg News reported. Reserve Bank Governor Philip Lowe kept the cash rate at 1.5 percent, where it has stood since 2016, as expected by all economists. The jobless rate hit 5.6 percent in April, moving further away from the central bank’s estimated level of full employment. The global picture has also become more clouded amid an emerging-market rout, populism in Europe and U.S. trade tariffs.
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