Economy

Commonwealth Bank takes controlling stake in Aussie Home Loans: Midday roundup

Patrick Stafford /

The Commonwealth Bank has increased its stake in Aussie Home Loans to 80%, with the company saying it has plans to eventually gain full ownership of the company.

CBA purchased 33% of Aussie Home Loans four years ago.

The announcement was made today, with current Aussie executive chairman John Symond to remain in his current role.

“We recognise the strength and reputation of the Aussie brand and name in the Australian mortgage market and also the importance of broker distribution of home loans and other financial products,” CBA group executive group strategic development, Rob Jesudason said in a statement.

“For Aussie, it will be business as usual as it continues to provide a full range of services to brokers and lenders in the way it always has.”

Symond said the arrangement was a “great opportunity”.

“We now have the opportunity to grow by investing in our product and service offerings and will remain a strong competitor in the mortgage broking channel,” Symond said.

Mining boom may be nearing peak, RBA minutes claim

The Reserve Bank has said in the minutes of its latest meeting that the decision to cut the official cash rate was influenced by a belief the mining boom is nearing its peak.

“At this meeting, the information on labour costs and softening labour market conditions suggested that the inflation outlook still afforded the board some scope to provide additional support to demand,” the RBA said.

“Further confirmation that the peak in resource sector investment was near, and that the short-term outlook for non-resource investment remained subdued, indicated that there was a case for the board to provide that support.”

The rate is now at its lowest point since April 2009.

The RBA also said lending rates were now at a medium-term average, with an effect flowing through to the rest of the economy.

“Some of the expected effects were starting to be observed and further effects could be anticipated over time,” the RBA said.

Shares reach new 2012 high

The Australian sharemarket has opened higher this morning, even reaching a new 2012 high after positive leads from Wall Street as investors are confident Washington is heading towards a solution over the country’s debt.

The benchmark S&P/ASX200 index was up 31 points or 0.7% to 4,604.5 at 12.00 AEST, while in the United States, the Dow Jones Industrial Average rose 100 points or 0.8% to 13,235.4.

 

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Patrick Stafford

Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.

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