National Australia Bank chief Cameron Clyne says the next 12 months will prove challenging as markets remain volatile and consumer sentiment remains low.
“We recognise that 2012 will be challenging as we face a combination of volatile markets and subdued consumer and business sentiment,” he said at the company’s annual general meeting.
Clyne also defended the company against claims it had not passed on the full interest rate cut from November.
“What is important is that we have maintained the lowest advertised standard variable rate of the other major Australian banks – a position we have held for over two years now,” he said.
NAB chairman Michael Chaney also said global economic turmoil is affecting the company.
“The volatile overseas markets and new global banking regulatory requirements have pushed up the cost of funds and the current instability in Europe presents us with additional pressures in the wholesale term funding markets,” he said.
While European leaders have started work on a recovery deal, Chaney said there aren’t necessarily any short-term objectives.
Former head of the Australian Competition and Consumer Commission Graeme Samuel has reportedly won a $5 million lawsuit against his former partners in the DFO business.
Fairfax has reported this morning that the Victorian Supreme Court has thrown out defences to the lawsuit filed by entities owned by Geoffrey Porz.
Justice Jennifer Davies has reportedly said allegations Samuel was a shadow director “raise a fanciful defence that has no real prospects of success”.
The ruling comes after the Supreme Court ruled earlier this week that DFO founders David Goldberger and David Wieland would need to pay interest on guarantees given to financiers.
Shares fall as Euro fears grow
The Australian sharemarket has fallen this morning after negative leads from the United States, where investors are growing more wary about a deal for the Eurozone.
The benchmark S&P/ASX200 index was down 56 points or 1.4% to 4133.7 at 12.00 AEST, while the Australian dollar fell below parity to $US0.98c.
AMP shares were down 0.46% to $4.31, while Commonwealth Bank shares lost 1.17% to $48.80. Westpac lost 1.35% to $20.52, while NAB lost 1.07% to $23.60.
In the United States, the Dow Jones Industrial Average lost 131.5 or 1.1% to 11,823.5.
The International Monetary Fund has confirmed it will lend Ireland $5.13 billion as it attempts to stop the country from defaulting on its debt.
The IMF has announced the “immediate disbursement” of the funds.
The IMF said the funds were “part of a financing package amounting to €85 billion also supported by Ireland’s European partners.”
Greek Prime Minister Lucas Papademos has warned the country’s economy will shrink, with the contraction likely to be higher than the forecasted 5.5%.
“2011 will be the worst recession here ever,” he said overnight. “We have a hard way to go.”
The head of the IMF’s efforts in Greece, Poul Thomsen, also said the economy will go down “6% and maybe more” this year.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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