Allens

Banking & Finance

Our experienced Banking & Finance legal team regularly publishes articles and updates - the full list of publications appears below. These publications contain the latest news and developments, and look at the ramifications for your business. If you'd like to be notified when we add new banking & finance publications to the site, please go to our subscription page to sign up for email alerts or, alternatively, you can subscribe to our RSS feed.

See also our banking & finance pages for more information on our broad range of skills and experience in the financial sector, including capital raisings, securities, superannuation and managed investments.

Banking & Finance Publications

  • Unravelled: Crowd-sourced equity funding

    5 February 2016

    The Government has finally begun the process of implementing its policy on crowd-sourced equity funding (CSEF) by introducing a Bill and releasing draft exposure regulations late last year, which envisage the establishment of a CSEF regime in Australia. The Bill has been referred to the Senate Economics Legislation Committee who are expected to report later this month.

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  • Unravelled: Raising professional standards of financial advisers

    5 February 2016

    Following on from the reviews conducted by the Parliamentary Joint Committee and the Financial System Inquiry, the Government delivered on its promises by releasing an exposure draft of the Corporations Amendment (Professional Standards of Financial Advisers) Bill 2015 (the Bill) late last year for consultation. As its title suggests, the draft Bill proposes a number of amendments to the Corporations Act to raise the professional standards of financial advisers that are to apply from 1 July 2017. Many of these reforms impose obligations that licensees in the retail financial advice and superannuation trustees should carefully consider and begin making provision for.

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  • Client Update: Guarantors owed a duty of care under the Code of Banking Practice

    21 January 2016

    A recent decision of the Victorian Court of Appeal has given a wide meaning to the Code of Banking Practice, finding that the duty of care owed by a lender in assessing the borrowers' ability to repay, extends to guarantors. Effectively the bank was responsible to guarantor/directors for funding their own bad business decision. Partner Karla Fraser, Senior Finance Counsel Diccon Loxton and Research Assistant Harry Stratton report.

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  • Client Update: New measures on resilience, collateral protection and client money

    22 December 2015

    The Government yesterday released for consultation draft legislation containing 'resilience and collateral protection' measures. Think payment systems, netting and derivatives. But also think superannuation trustees and life companies investing in centrally-cleared OTC derivatives – and restrictions on charging assets. The Government also released a policy paper on how to make the client money provisions more protective. Partners Tom Highnam and Michelle Levy and Senior Regulatory Counsel Michael Mathieson look at some of main points of the new draft legislation.

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  • Unravelled: Product rationalisation - again

    8 December 2015

    The FSI report recommended that the Government facilitate rationalisation of legacy products in the life insurance and managed investment scheme industries. The need for ways to close legacy products has been kicking around for at least a decade and, in 2007, Treasury released a very thorough options paper covering product rationalisation in the managed funds sector. Treasury said that sector was represented by life insurance, managed investment schemes and superannuation.

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  • Unravelled: Government launches innovation agenda - now wait for the ideas boom

    8 December 2015

    You might be getting tired of all of the talk about 'innovation', and keen to see some of it actually happen. The Government's recent announcements could help, but there is a long way to go before the 'mining boom' becomes the 'ideas boom'.

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  • Unravelled: FSI outcomes - what will happen and when?

    8 December 2015

    Are you interested in the financial system and how it is regulated? The Federal Government's response to the Financial System Inquiry was recently handed down but it can be hard to work out where, exactly, things are heading. We have put together a table that sets out what is likely to happen and when.

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  • Client Update: Major overhaul of Australia's foreign investment laws: what's new?

    4 December 2015

    The new package of legislation overhauling Australia's foreign investment laws, the first major revision in 40 years, commenced on 1 December 2015. While many features of the previous regime have been retained (and sometimes re-named), there are also a number of significant changes. Partners Jeremy Low, Wendy Rae and Richard Kriedemann and Senior Associate Eve Regnard review the key new elements.

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  • Focus: UK Supreme Court counters High Court on penalties

    19 November 2015

    The highest appellate court in the UK has affirmed and restated the penalty rule as it applies in the UK in a recent decision that directly addresses, and counters, the High Court of Australia's approach to the rule in Andrews. Partner Nick Rudge and Lawyer Patrick Easton report.

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  • Focus: PNG securities laws rewrite

    9 November 2015

    Those dealing in PNG's capital markets should be aware that the PNG Parliament recently passed a package of legislation to substantially amend and strengthen the regulation of its capital markets. The regime will introduce new licensing requirements for those involved in activities such as securities dealing, funds management, and corporate advice. The role of the PNG Securities Commission will be strengthened and expanded, and the rules relating to offers of securities will be updated. Partner Richard Kriedemann looks at the new regime.

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  • Unravelled: What does the Government's response to the FSI mean for banks?

    6 November 2015

    The short answer is: it depends on which kind of bank you are. The Financial System Inquiry's final report and the Government's response mean a lot for ANZ, CBA, NAB and Westpac, particularly given their significant residential mortgage portfolios. They also mean a lot for Macquarie. As for the rest of the banks, they are likely to see the ramifications for the major banks as their own gain.

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  • Unravelled: Superannuation and the Government's response to the FSI

    6 November 2015

    The Government's response to the FSI's superannuation recommendations is, as with much of the rest of the responses, somewhat safe (and, as a result, arguably disappointing). As with the Inquiry's recommendations, it shifts from the sublime to the ridiculous – on the one hand it deals with the really central question of what our superannuation system is for, to the other of extending choice of fund to the small number of employees who are currently excluded because they are covered by State awards and enterprise agreements. In between, it is going to ask the industry to sort out retirement incomes (with some legislative loosening) and the Productivity Commission to sort out costs and competition.

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  • Unravelled: Government says 'Yes ASIC'

    6 November 2015

    The FSI recommended that the Government 'Introduce an industry funding model for Australian Securities and Investment Commission (ASIC) and provide ASIC with stronger regulatory tools'. This recommendation (No.29) covers two topics that ASIC has pursued on a number of occasions, including in its submissions to the FSI. The first is ASIC's preference to move to an industry funding model; and the second is ASIC's recommendation that penalties under ASIC-administered legislation be increased.

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  • Report: Green Bonds: emergence of the Australian and Asian markets

    23 October 2015

    The global market for Green Bonds continues to grow steadily, driven by strong investor demand and the continual need for capital to finance 'green' projects.

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  • Focus: Painting the full picture: certifiers and financiers in projects

    20 October 2015

    A recent decision of the UK High Court provides valuable instructions to both financiers and consultants regarding their obligations in monitoring project developments. Partners Nick Rudge (view CV) and David Donnelly (view CV) and Lawyer Patrick Easton report on the decision in Lloyds Bank plc v McBains Cooper Consulting and its relevance to parties to Australian projects.

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  • Unravelled: Proposed industry funding model for ASIC

    6 October 2015

    Treasury has released a Consultation Paper seeking comments on a proposed industry funding model for ASIC. Under the proposed model, the costs of ASIC's regulatory activities will be recovered directly from the companies and other entities that are regulated by ASIC – at a direct cost to industry of approximately $260 million. This amount will be collected through a combination of annual supervisory levies (around $196 million) and significant fee increases for fee-for-services activities to reflect ASIC's actual costs of providing specific on-demand services to individual entities. In this article, we look at the proposed model in more detail.

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  • Unravelled: Corporate culture and conduct risk

    6 October 2015

    Regulators, particularly in the UK and Australia, are increasingly interested in corporate culture in the financial services industry, its impact on the integrity of the system, and what the regulators are doing to try to entrench a corporate culture that works for the benefit of consumers and investors. In this article, we look at various aspects of the relationship between corporate culture and conduct risk – convincing Australian financial services organisations that by focusing less on profit, and more on investors' long-term interests and market integrity, they really are helping themselves.

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  • Client Update: PPS deregulation measures to take effect

    29 September 2015

    From 1 October 2015, short-term leases of serial numbered goods will no longer be deemed security interests under the PPSA. Businesses should review their current PPS policies and, where appropriate, implement changes to processes, as Partner Karla Fraser and Lawyer Katharine Ward explain.

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  • Unravelled: ASIC - A crackdown on corporate culture

    4 September 2015

    Corporate culture, and its role in shaping conduct within the financial services sector, is now clearly at the forefront of ASIC's enforcement agenda. This focus was apparent in ASIC's 2014-2015 strategic outlook, released in October 2014, which identified corporate culture as a key risk driver and poor culture within the financial services sector as a root cause of conduct that threatens the integrity of the financial services industry.

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  • Unravelled: The UK's focus on personal accountability for bank employees: a sign of things to come?

    4 September 2015

    Last month we discussed the 'carrot' in the UK Parliamentary Commission on Banking Standards – how the regulators are making sure remuneration for bank staff encourages prudent risk behaviour. This month we are looking at the 'stick' – how the UK is strengthening regulators' enforcement armoury to enable them to more easily take action against individuals who do not meet the conduct standards expected of them.

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  • Unravelled: Regulating bonuses: will Australia be next?

    5 August 2015

    The UK's Financial Conduct Authority and Prudential Regulation Authority released rules, in June this year, to further tighten what are already fairly onerous restrictions on the payment of bonuses to staff in banks, building societies and certain big investment firms. The world's financial regulators have, for some time, been trying to crack down on what they consider to be inappropriate remuneration structures and it begs the question – will Australia be next?

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  • Focus: Agency arrangements alright - ANZ and Flight Centre succeed in appeals

    31 July 2015

    The Full Federal Court today handed down its decisions in two high-profile appeals in relation to ANZ and Flight Centre. Both cases dealt with the issue of distribution arrangements and price fixing. Partner Carolyn Oddie and Associate Theodore Souris look at the implications for business.

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  • Client Update: PPS deregulation measures one step closer

    9 July 2015

    A long-awaited change designed to reduce the compliance burden for security interests arising from short-term leases of serial numbered goods is one step closer to becoming law. Partner Karla Fraser and Law Graduate Katharine Ward report.

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  • Unravelled: Draft rules published for mandatory central clearing of derivatives and single-sided reporting

    3 July 2015

    ASIC has published draft rules for mandatory central clearing of certain derivatives, while Treasury has published draft regulations that would permit single-sided reporting of Over-the-Counter Derivatives in some situations. Partner Tom Highnam and Lawyer David Lewis discuss the implications of these draft rules and regulations.

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  • Unravelled: How to avoid anti-money laundering compliance headaches - financial product issues

    3 July 2015

    Issues of securities, interests in managed investment schemes and other types of financial products typically involve a number of 'designated services' under Australia's anti-money laundering and counter terrorism financing (AML/CTF) regime. However, in the midst of preparing governing documents, disclosure documents and negotiating with service providers, it is all too easy for parties to neglect AML/CTF issues when preparing for a product launch. They should not, particularly in light of recent developments on the AML/CTF front.

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  • Linklaters Insights: Legal implications of the Greek debt crisis

    30 June 2015

    After months of political stalemate in negotiations with its creditors to unlock access to bailout funds, the Greek government has announced a referendum on proposed bailout conditions, an extended bank holiday and the imposition of capital controls.

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  • Focus: Draft rules published for mandatory central clearing of derivatives and single-sided reporting

    19 June 2015

    ASIC has published draft rules for mandatory central clearing of certain derivatives, while Treasury has published draft regulations that would permit single-sided reporting of Over-the-Counter Derivatives in some situations. Partner Tom Highnam and Lawyer David Lewis discuss the implications of these draft rules and regulations.

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  • Unravelled: Full Federal Court rules against agreed civil penalties

    4 June 2015

    Ecstasy, cocaine and industrial action at a construction site are unlikely subjects for an article on financial services regulation. They are, however, the things that have led to what could be a significant change to the way in which financial services regulators like ASIC and APRA can resolve civil penalty proceedings.

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  • Unravelled: Tax musings

    4 June 2015

    You would need to have been living under a large rock with your hearing aid turned off not to be aware of the current debates raging in relation to tax. But it is hard to sort the wood from the trees or the real facts and issues from all the surrounding noise.

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  • Unravelled: Trowbridge - a bridge too far?

    4 June 2015

    In October 2014, ASIC released its report into retail life insurance advice practices. The findings were pretty grim – with poor advice being more common than good, or even adequate, advice. ASIC said that advisers were motivated by the promise of commissions, not the interests of their clients. Following the ASIC report, the Association of Financial Advisers and the Financial Services Council bravely commissioned a review of the report by a working group chaired by John Trowbridge. They asked Mr Trowbridge to make recommendations on how the industry should respond to ASIC's findings. And he has.

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  • Paper: Funding a Fund: The growth of the capital call facility

    25 May 2015

    The Australian corporate debt market is primed for growth, with an increase in the number of funds providing direct lending as an alternative source of financing to the traditional lending dominated by domestic banks. In this paper, Partner Tom Highnam and Senior Associate Rita Pang examine the growth of one of the methods by which funds use and raise debt - the capital call facility.

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  • Paper: The Public-Private Partnership Law Review

    21 April 2015

    Partners David Donnelly and Nicholas Ng examine public-private partnerships (PPPs) in Australia, including the year in review, the general framework, bidding and award procedures, recent decisions and the outlook for 2015.

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  • Client Update: Significant 'blow' for penalties claims

    8 April 2015

    Today the Full Federal Court clarified the law of penalties as it applies to fees. The key development is that, in considering whether the amount of a fee is 'extravagant and exorbitant' compared to the potential costs incurred in dealing with a failure to perform an obligation, the court held that indirect costs could be taken into account. Subject to a likely attempt to appeal to the High Court, this development imposes a substantial hurdle for current and future penalties class actions. Partner Jenny Campbell and Lawyer Alicia Lyons report.

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  • Unravelled: Bank capital - where to from here?

    1 April 2015

    If you have been following the debate about bank capital in recent months, you could be forgiven for thinking there is only one issue: how much capital should banks have to hold on account of their residential property lending activities? However, the Financial System Inquiry’s recommendations on bank capital delved into other areas as well - and they have potentially more far-reaching consequences

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  • Unravelled: The fintech phenomenon - risks and opportunities

    1 April 2015

    Everyone is talking about fintech. What is it? And what does it mean for the financial services industry and for regulation?

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  • Linklaters Insights: Shanghai-Hong Kong Stock Connect: new short selling rules

    27 March 2015

    With the launch of the Shanghai-Hong Kong Stock Connect in November of last year, foreign investors now have direct trading access to many shares listed on the Shanghai Stock Exchange.

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  • Linklaters Insights: Stock Connect: the Beneficial Ownership conundrum

    27 March 2015

    Since the launch in November of the Shanghai-Hong Kong Stock Connect programme, various concerns have been expressed in relation to investments made by certain collective schemes, in particular EU-regulated Undertakings for Collective Investment in Transferable Securities or UCITS.

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  • Linklaters Insights: PBOC opens up new financing channels for entities in the Shanghai Free Trade Zone

    24 March 2015

    New measures of the PBOC have reformed the approval and quota-based system for borrowing RMB and foreign exchange outside China. The new measures allow more flexibility for corporates and non-bank financial institutions incorporated in the Shanghai Free Trade Zone, as well as the separate SFTZ accounting units of Shanghai-based banks for business booked in the SFTZ, to structure their foreign debt profiles.

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  • Focus: Social benefit bonds - their role in the funding challenge for social infrastructure and services

    20 March 2015

    With the recent Intergenerational Report having further highlighted the need to deliver social outcomes in an efficient way, Partners David Donnelly and James Darcy report on the potential role of social benefit bonds in providing social infrastructure and services.

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  • Paper: Project finance in Australia

    17 March 2015

    Three of Allens' most experienced project finance partners, Phillip Cornwell, Richard Gordon and Ben Farnsworth, spoke to GTDT: Market Intelligence - Project Finance about project finance trends, including which industry sectors have been the most active and the most significant deals in Australia.

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  • Unravelled: Demystifying bank capital

    5 March 2015

    Hands up if you tuned in to the Financial System Inquiry's discussion of bank capital - but felt you didn't really understand the basics well enough to follow it closely? To paraphrase one of our (numerous) recent prime ministers, this article is 'here to help'.

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  • Unravelled: ASIC's enforcement powers may receive a boost

    5 February 2015

    In preparing its Final Report, the FSI has clearly paid close attention to the report of the Senate Economics References Committee's Report into ASIC's performance and its recommendations designed to strengthen ASIC through a combination of better funding, an enhanced regulatory toolkit and higher penalties, with a view to enabling it to be the 'respected and feared' leader desired by the Senate Committee. The impact of the FSI's recommendations is now likely to be the subject of further submissions to the Government before any decisions are taken.

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  • Unravelled: Bold and sometimes radical - the final Murray report

    7 December 2014

    The Financial System Inquiry's final report has been released. We haven't tested this with 'Word Cloud', but we think the report can best be encapsulated in the word 'however'. The financial system has held up well, 'however, ...'. And what follows the 'however' is often bold and sometimes radical. There are five chapters and just 44 recommendations - compare this with the Cooper Review's 177 recommendations. But this helps - the messages are clear and the recommendations plain, although much of the implementation is left to the imagination.

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  • Client Update: Peer-to-peer lending - a disruptive threat to banks?

    5 December 2014

    One of the things we are very interested in at the moment is how peer-to-peer lending will develop in Australia, and how it could be a disruptive threat to banks. We're not the only people who are interested though. On 4 December, it was announced that a powerful consortium comprising James Packer, News Corporation and Kerry Stokes had struck a deal to take a 25 per cent stake in SocietyOne. SocietyOne was launched in 2012 as Australia's first peer-to-peer lending platform and also counts Westpac as one of its early stage investors. Partner Gavin Smith, Senior Associates Matt Vitins and Andrew Edington and Lawyer Michael Beaconsfield report on peer-to-peer lending, and how it is regulated in Australia.

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  • Audio: FSI Final Report due out Sunday

    4 December 2014

    The Final Report of the Financial System Inquiry is scheduled to be released this weekend. Partners Michelle Levy and Matthew McLennan spoke to BRR Media about some of the recommendations that may be in the Final Report.

    Listen
  • Unravelled: Bank technology failures: A new frontier for regulatory intervention?

    3 December 2014

    The UK's regulatory authorities have imposed the largest ever fines in Europe for technology failures in the financial services industry following a serious IT incident affecting more than 6.5 million customers in the UK. It should serve as a cautionary tale for Australian financial institutions.

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  • Unravelled: Fighting to protect Fintech innovations

    3 December 2014

    The growth of financial services technology, or Fintech as it is now called, has exploded in recent years, yet many of its creators don't realise that their innovations are patentable.

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  • Unravelled: Risk management - what, if anything, does the 'three lines of defence' model do?

    5 November 2014

    From 1 January 2015, a new 'common' risk management prudential standard will apply to banks, general insurers and life companies and, in many cases, to other companies in the corporate groups in which those institutions sit. Michael Mathieson looks at the 'three lines of defence' model that APRA proposes to adopt in its associated risk management guidance materials.

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  • Unravelled: The fiduciary duty of mortgage brokers?

    5 November 2014

    There is lots of noise about the duties of financial advisers, and lawyers (including us) love to debate whether FoFA has left any room for fiduciary obligations.

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  • Unravelled: Should APRA's prudential standard-making powers extend to directors' duties?

    5 November 2014

    In recent times, APRA has been active in prescribing duties for directors of the institutions it regulates. In light of what has happened, it is worth asking: should the question of directors' duties be excluded from APRA's prudential standard-making powers?

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