Westpac CEO resigns amid money-laundering scandal

SYDNEY, Australia — Australian banking giant Westpac said Tuesday its beleaguered CEO Brian Hartzer was stepping down after regulators accused the bank of wholesale breaches of money laundering rules involving more than US$7 billion.

Westpac is facing a potentially massive fine over claims that it failed to report millions of international fund transfers, including "high-risk transactions" to Southeast Asian nations potentially linked to child exploitation.

"As CEO, I accept that I am ultimately accountable for everything that happens at the bank," Hartzer said in a statement announcing the changes.


"It is clear that we have fallen well short of what the community expects of us, and we expect of ourselves."

Current chief financial officer Peter King will take over the reins until a "global search process" for a permanent replacement is completed.

The axe also fell on company chairman Lindsay Maxsted, who will bring forward his retirement to "the first half of 2020" and long-standing director Ewen Crouch, who will not seek re-election next month.

Australia's financial intelligence agency AUSTRAC said the bank committed 23 million breaches of money laundering and counterterrorism rules, theoretically putting the bank on the hook for up to Aus$483 trillion (US$330 trillion) in fines.

Government treasurer Josh Frydenberg said "there needed to be accountability" because the alleged breaches were "of the most serious nature" but also stressed the importance of the financial sector.


Troubles for the Big Four 

Australia's largest lender, the Commonwealth Bank (CBA), last year faced a theoretical maximum fine of Aus$1 trillion after AUSTRAC found it had failed to report on 53,500 transactions -- a fraction of the alleged breaches by Westpac.

The CBA ended up negotiating an Aus$700 million settlement.

Among the most damaging allegations against Westpac, the regulator accused bank executives of "indifference" to clear evidence that some international transfers were used to fund child exploitation.

AUSTRAC said the bank had been aware of heightened risks associated with frequent small payments destined for Southeast Asia since 2013 and had been "specifically briefed" on the risks with respect to one of its money transfer channels in June 2016.

In a conference call, Maxsted acknowledged the bank may lose customers as a result of the breaches, but urged them to "stick with us" and "understand that we feel so remorseful".

Westpac's share price climbed 1.9 percent in morning trade on the news.

Australia's banking industry, one of the world's most profitable, is facing an array of challenges.

The country's four biggest banks -- CBA, Westpac, National Australia Bank (NAB) and ANZ -- were the target of a royal commission that earlier this year exposed rampant malpractice across the sector.

It found banks had charged fees to dead people and to others for no services at all, used aggressive sales tactics and provided poor advice that led to significant financial upheaval for clients.

All the banks have reported significant hits to profits as they reimburse hundreds of millions of dollars to wronged customers.

source: philstar.com

MORE TO COME? | SWIFT warns banks on cyber heists as hack sophistication grows

SWIFT, the global messaging system used to move trillions of dollars each day, warned banks on Wednesday that the threat of digital heists is on the rise as hackers use increasingly sophisticated tools and techniques to launch new attacks.

Brussels-based SWIFT has been urging banks to bolster security of computers used to transfer money since Bangladesh Bank lost $81 million in a February 2016 cyber heist that targeted central bank computers used to move funds. The new warning provided detail on some new techniques being used by the hackers.

“Adversaries have advanced their knowledge,” SWIFT said in a 16-page report co-written with BAE Systems Plc’s cyber security division. “No system can be assumed to be totally infallible, or immune to attack.”

SWIFT has declined to disclose the number of attacks, identify victims or say how much money has been stolen. Still, details on some cases have become public.

Taiwan’s Central News Agency last month reported that Far Eastern International Bank lost $500,000 in a cyber heist. BAE later said that attack was launched by a North Korean hacking group known as Lazarus, which many cyber-security firms believe was behind the Bangladesh case.

Nepal’s NIC Asia Bank lost $580,000 in a cyber heist, two Nepali officials told Reuters earlier this month.

The new report described an attack on an unidentified bank. Hackers spent several months inside the network of one customer, preparing for the eventual attack by stealing user credentials and monitoring the bank’s operations using software that recorded computer keystrokes and screenshots, the report said.

When they launched the attack in the middle of the night, the hackers installed additional malware that let them modify messaging software so they could bypass protocols for confirming the identity of the computer’s operator, according to the report.

The hackers then ordered payments sent to banks in other countries by copying pre-formatted payment requests into the messaging software, according to the report.

After the hackers ended the three-hour operation, they sought to hide their tracks by deleting records of their activity. They also tried to distract the bank’s security team by infecting dozens of other computers with ransomware that locked documents with an encryption key, the report said.

While SWIFT did not say how much money was taken, it said the bank quickly identified the fraudulent payments and arranged for the stolen funds to be frozen.

source: interaksyon.com

After roads and railways, China’s Silk Road dealmakers eye financial firms

HONG KONG – After ports and industrial parks, the dealmakers leading China’s trillion-dollar push to build a modern Silk Road are turning to the financial sector, targeting Europe’s banks, insurers and asset managers to tap funds and expertise.

Last week, sources familiar with the matter said two of China’s most acquisitive conglomerates, HNA Group and Anbang Insurance Group, had separately considered bidding for the German insurer Allianz SE.

Neither of the two made an offer, but the talks marked a new level of ambition for China: Allianz is a German stalwart, a pillar for local pensions and a global powerhouse with 1.9 trillion euros ($2.3 trillion) of assets under management.

HNA already owns a stake of just under 10 percent in Deutsche Bank.

Bankers, lawyers and company executives say more financial deals will come, led by state behemoths such as China Life and China Everbright, as well as private firms including Legend Holdings and China Minsheng Financial.

“The message from the regulators is clear – they want these companies to go out and get access to large amount of funds and expertise,” said a financial M&A adviser at a global bank, who works with Chinese regulators and companies.

“They would look very favorably at transactions that have some links to the Belt and Road program, because the country needs to boost its financial muscle,” the banker said. But Beijing “will ensure the excesses of the past couple of years do not happen again.”

The banker, who declined to be named as he was not allowed to speak to the media, said his firm was currently working on several “mid-sized to large” foreign financial takeover deals.

After a deal spree that saw Chinese conglomerates spend billions on everything from landmark property to soccer clubs in a debt-fuelled M&A drive over the past two years, Beijing has sought to rein in some of the excesses.

But Belt and Road deals have been an exception in the crackdown this year – including, most recently, financial deals.China’s outbound M&A volume targeting financials has reached nearly $9 billion as of last week this year, not far from $12 billion in all of 2016, according to Thomson Reuters data. If exceeded, it would be the second best year for such deals since at least the global financial crisis in 2008.

The share of financial transactions in overall outbound deal volume has also risen to 8.2 percent this year, higher than 5.7 percent in the same period last year, while industrial deals, typically the biggest sector for outbound M&A, fell by a third.

EXPANDING FOOTPRINT

Earlier this month, Legend – the top shareholder in the computer maker Lenovo – agreed to buy a 90 percent stake in Banque Internationale a Luxembourg (BIL) for $1.8 billion.

The deal, Legend said, was linked to the Belt and Road initiative, President Xi Jinping’s policy of building a modern Silk Road to expand global trade and influence.

“Our overseas investments will continue to focus on the opportunities that are provided by the Belt and Road national policy,” the company said, in a statement to Reuters, adding it would “actively invest” in other areas of financial services, including insurance, securities and financial technology.

It gave no details, but bankers said Legend has been eyeing banks and insurers in Southeast Asia, Europe and Hong Kong, using its healthy balance sheet and the halo effect of Belt and Road-linked initiatives.

Better financial expertise and depth will help China secure contract guarantees, financing and better insurance.

“We need those overseas financing institutions – buying them can expand our bank assets and boost foreign firms’ participation in our projects abroad,” said Huo Jianguo, vice-chairman of the China Society for WTO Studies, under the Ministry of Commerce.

“China is having a hard time attracting international institutions to get involved” in Belt and Road projects, Huo said. “If that persists it will become an one-man show, which is not sustainable.”

Besides Legend, others eyeing the sector include the insurer China Life, China Minsheng Financial, China Everbright Ltd,part of the state-owned China Everbright Group, and Haitong International Securities.

They are mainly scouting for investment and acquisition targets in Europe and Asia, said bankers and lawyers.

WATCHDOGS

Chinese companies will not be expanding into the financial services sector at will, of course. Acquisitions of stakes in foreign banks – never mind full ownership – are already closely monitored by overseas regulators.

But while banks may be tough targets, bankers and executives say Chinese institutions and conglomerates could instead target asset management, insurance or wealth managers.

China Everbright plans to allocate $1.5 billion of its 2017 spending to the purchase of a fund manager, private bank or insurer overseas to help it raise cash more easily and extend its presence abroad.

China Merchants Bank has been “actively looking” for wealth management firms in Europe, said one person familiar with the matter, adding that not all financial acquisitions in the near term may have clear Belt and Road links.

China Minsheng Financial declined to comment on its plans, while Haitong International said it does not “have any plans at the moment”. China Life, Legend and China Merchants Bank did not respond to requests for comment.

“Finance is definitely an encouraged sector under the recent Chinese outbound investment guideline,” said Christina Lee, a partner at the law firm Baker McKenzie’s capital markets practice in Hong Kong.

“PRC financial institutions are mostly domestically focused,” Lee said. “M&A is a fast way to gain exposure and expertise in the international finance scene.”

source: interaksyon.com

Malaysia, Indonesia markets roiled as investors scramble for hedge on Trump

JAKARTA -- Emerging markets in Southeast Asia were slammed on Friday as the stunning upset of Donald Trump's presidential win in the United States reverberated around the world, with Malaysia and Indonesian central banks intervening to try to stem the flow of money out of stocks and bonds.

The latest selloff was triggered by markets recalibrating their expectations of a Trump presidency on broad economic policy, with a growing consensus that his policies will be inflationary and push US rates up driving investors out of emerging markets and into dollar-based assets.

Yields on benchmark 10-year Treasuries have spiked 41 basis points in the past two days as investors scrambled to readjust their positions.

Emerging markets in Asia are particularly vulnerable to hot money outflows, and deep uncertainty over how broad US and international policy will ultimately play out under Trump has unsettled investors.

On Friday's Asian session, the differential between the onshore spot rate in the Malaysian ringgit and the offshore NDF rate spread hit its widest since 2009.

Ringgit one-month non-deliverable forwards plunged to 4.5280 per dollar, while spot ringgit stood at 4.2670. As a result, the dollar/ringgit's NDFs premium over the dollar/ringgit spot widened to 0.2610, the widest since at least April 2008, according to Reuters data.

The subdued spot rate belied the drama because Bank Negara Malaysia was acting to stem any panic, traders said.

Malaysia's central bank governor Muhammad Ibrahim told reporters on Friday the ringgit should not be priced out of sync with fundamentals, and that it has a responsibility to tell banks to take temporary measures to calm the market

"We don't want to be dictated by factors that have nothing to do with the country's fundamentals," Ibrahim said.

Traders in Kuala Lumpur said the central bank had told them not to quote offshore rates and was approving large ringgits sell orders on a one-off basis in a bid to keep a lid on things. The tactic seemed to work with onshore trade reportedly very thin.

Hot money headache

However, yields on Malaysian government bonds told another story. Yields on 10-years have widened 22 basis points since Wednesday, while those on 20-year and 30 year bonds have widened 21 basis points and 10 basis points respectively over the same period.

Almost 40 percent of Malaysian government bonds are in foreign hands.

Malaysian stocks were down almost one percent.

Indonesian markets also dived in early trade. Indonesia has enjoyed relatively high inflows into stocks and bonds markets in the past few months, making it vulnerable to hot money outflows at times of uncertainty.

The rupiah  fell as much as 2.7 percent, while Jakarta Composite Index fell as much as 3.2 percent to its lowest since Sept 16.

Bank Indonesia sold dollars to stabilize the currency, traders said, but it still fell to a four-month low.

Nanang Hendarsah, an official at BI, said the rupiah's sharp drop was caused by sudden hedging activity in the NDF market, but noted outflows from Indonesian markets were contained so far.

Yield of Indonesia's 10-year government bonds jumped on Friday to 7.462 percent from 7.417 percent. Foreigners own 38.4 percent of outstanding Indonesian government bonds.

Philippine stocks were also caught in the selloff with the main index tumbling more than 2.5 percent. The Philippines peso, however, was steady at 48.99.

The short term might prove a head-spinning affair for investors, especially for those in emerging markets.

"With the market now pricing in low expectations of further US Federal Reserve rate hikes beyond the one expected in December, Mr. Trump’s economic policies present an upside risk to rates," said Khoon Goh, head of Asia research at ANZ.

"This, coupled with the depreciation pressure on Asian currencies, has put serious pressure on Asia’s carry trades."

source: interaksyon.com

In Ecuador cyber heist, thieves moved $9 million to 23 Hong Kong firms

HONG KONG/CHICAGO  - Cyber thieves who stole $12 million from an Ecuadorian bank in 2015 routed the funds through 23 companies registered in Hong Kong, some of them with no clear business activity, according to previously unreported court filings and judicial rulings.

The court papers offer a first glimpse into where some of the money was moved after it reached accounts in Hong Kong.

The filings stem from a lawsuit filed in early 2015 by Ecuador's Banco del Austro (BDA) in Hong Kong against the web of companies that received or handled more than $9 million in stolen funds, bank records submitted to the territory's Court of First Instance show. The BDA lawsuit alleged the companies had been "unjustly enriched" and sought recovery of the money.

The remaining $3 million was routed to entities in Dubai and elsewhere, according to separate court filings in the U.S. Those transfers are not the subject of litigation in Hong Kong.

The cyber thieves allegedly used the SWIFT global messaging system to move the funds. SWIFT, a conduit for bank money transfers worldwide, also was the network used to move $81 million out of Bangladesh Bank in February.

According to the Hong Kong court filings, BDA submitted criminal reports to police in both Hong Kong and Ecuador about the transfers. The content of those reports was not part of the court record reviewed by Reuters. The attacks have caught the attention of global investigative agencies. The U.S. Federal Bureau of Investigation and Bangladesh authorities are leading a search for criminals behind the February heist, which ranks among the largest ever.

In the Ecuadorian heist, the money was transferred by Wells Fargo based on authenticated SWIFT messages, and both BDA and the U.S. bank now believe those funds were stolen by unidentified hackers, according to documents in a BDA lawsuit filed against Wells Fargo in New York this year.

It was not clear whether the Hong Kong Police have launched an official probe. A spokesman for the agency declined to confirm or deny the existence of an investigation.

The Ecuador attorney general’s office did not respond to a request for comment. The FBI and BDA also declined comment.

Initially, cyber thieves moved $9.139 million of the more than $12 million they stole from BDA into the Hong Kong accounts of four companies at HSBC and Hang Seng Bank.

At least $3.1 million of the funds were then routed from those four companies to 19 "second layer" bank accounts, meaning the funds made a second hop to another set of Hong-Kong registered companies, the papers show.

Not tied to real businesses

Hang Seng did not immediately respond to a request for comment. HSBC declined to comment on the details of the case but a spokesman said in an e-mail that the bank actively co-operates with law enforcement and has controls in place to know its customers and deter crime.

SWIFT, an acronym for the Society for Worldwide Interbank Financial Telecommunication, has said its core messaging system has never been breached.

A BDA lawyer said in the filings that the Ecuador bank knew none of the firms or people behind the four companies that initially received the funds. Most of the "second layer" accounts appeared not to be tied to real businesses, the lawyer added.

Hong Kong Deputy High Court Judge Conrad Seagroatt said in a December ruling in the case that the four initial recipients showed no prior history of business activity. "They all appear to be otherwise inactive corporate vehicles controlled by citizens of the People's Republic of China," Seagroatt wrote.

In March last year, BDA secured an order from the court to freeze the accounts of the four companies that intially received the funds, although it later settled with the recipient of the smallest transfer of $95,731.18 and withdrew its claim against that firm, the court record shows.

As of last month, complaints against five of the 23 defendants had been withdrawn or dismissed, and settlements with some defendants have taken place, court papers reviewed by Reuters indicate.

BDA has declined to speak with Reuters about the Hong Kong case or the related litigation in the United States against Wells Fargo.

source: interaksyon.com

Cybercrime ring steals up to $1 billion from banks — Kaspersky

A multinational gang of cyber criminals has stolen as much as $1 billion from as many as 100 financial institutions around the world in about two years, Russian computer security company Kaspersky Lab said on Saturday.

The company said it was working with Interpol, Europol and authorities from different countries to try to uncover more details on what it being called an unprecedented robbery.

The gang, which Kaspersky dubbed Carbanak, takes the unusual approach of stealing directly from banks, rather than posing as customers to withdraw money from companies’ or individuals’ accounts. It said the gang included cyber criminals from Europe, including Russia and Ukraine, as well as China.

Carbanak used carefully crafted emails to trick pre-selected employees into opening malicious software files, a common technique known as spear phishing. They were then able to get into the internal network and track down administrators’ computers for video surveillance.

In this way, Kaspersky said, the criminals learned how the bank clerks worked and could mimic their activity when transferring the money.

In some cases, Carbanak inflated account balances before pocketing the extra funds through a fraudulent transaction. Because the legitimate funds were still there, the account holder would not suspect a problem.

Kaspersky said Carbanak also remotely seized control of ATMs and ordered them to dispense cash at a predetermined time, when a gang member would be waiting to collect the money.

“These attacks again underline the fact that criminals will exploit any vulnerability in any system,” Sanjay Virmani, director of Interpol Digital Crime Center, said in a statement prepared by Kaspersky. “It also highlights the fact that no sector can consider itself immune to attack and must constantly address their security procedures.”

source: interaksyon.com

Social media — More hindrance than help in banks’ cyber crime fight

LONDON — Banks are fighting an uphill battle to protect themselves and their client accounts from cyber attacks, and the sometimes careless use of social media by customers and staff isn’t making the fight any easier.

British police and banks this week warned customers about the rise in criminals using social media to strike up a relationship and then try to get money from them.

Personal details from sites such as Facebook, Twitter and LinkedIn are also being used by fraudsters to scam customers, including to help in the increasingly common practice of “vishing”, or voice phishing, industry sources said.

“Vishing” involves fraudsters calling and saying they are from the bank. They say there is a security problem, and ask the customer to call the emergency number on their bank card. But the fraudsters never hang up from the call — in Britain they are able to stay on the line for 2 minutes — and create a fake dial tone to convince the customer to provide account details or even transfer money to another account.

Britain’s BBA banking lobby group estimates one in six customers could fall for this type of fraud, or 8 million people in the United Kingdom alone.

“The classic cyber crime doesn’t involve extremely sophisticated technology, it involves finding a date of birth on social media,” said Paul Clandillon, European practice leader for fraud and financial crime at IBM, at a recent conference on financial crime.

Revelations this month that hackers had obtained details of 83 million customers of JP Morgan — one of the biggest data breaches in corporate history — have shown how vulnerable banks remain, despite spending hundreds of millions of dollars a year on cyber defences.

That was a complex attack, but far simpler and more frequent frauds involve scammers using social media profiles to obtain a fuller picture of potential victims, bank industry sources and fraud investigators said.

Fraudsters can map out a bank’s organizational chart via information on social media, or dig out customer information online. Often they don’t need to look far — when Barclays introduced debit cards with photos on them, for example, some customers posted photos of their new cards, including account details printed on them, on social sites.

The weakest link 


“They (fraudsters) view the customer as the weakest link and they are convincing customers they are the bank. They have access to data in ways they never had before,” Bruce Forbes, head of security investigations and digital forensics at Royal Bank of Scotland, said at last month’s BBA conference.

Banks have long been the favorite target of cyber criminals — although retailers, healthcare firms and others have also been hit — with attacks including attempts to steal money, client data or confidential information about sensitive financial deals, or just trying to disrupt systems.

So-called hacktivists can break into financial systems to score political points while state-sponsored hackers can look to conduct industrial espionage or disrupt economic activity using banks as intermediate targets.

Cyber crime costs the global economy $445 billion (279.36 billion pound) a year and continues to grow, according to the Center for Strategic and International Studies (CSIS). These losses come from fraud, intellectual property theft, and the mushrooming spending on cybersecurity itself.

Often hackers will not use data themselves, but parcel them up and sell them to other people to use, notably specialists who convert stolen passwords and identities into financial gains. Criminals can keep data for months or years before using it.

Defence tool

Social media provides a double-edged sword for banks, however, and the industry is also using it to fight back.

“Social media helps the criminals pursue their trade, but it also leaves a digital footprint in evidence that provides opportunities for us,” said Mark Rowley, assistant commissioner for specialist operations for London’s Metropolitan Police.

Technology developed more than a decade ago to help casinos in Nevada detect collusion between players and dealers is among the tools being used by banks to hunt for networks of organised fraudsters, by hunting out associations between people on social media that were otherwise nearly impossible to find.

Facebook, LinkedIn and Google Earth are also being used by banks alongside more complex searches, involving trawling for data that does not show on regular search engines.

Such “unstructured data” includes not just social media but pictures and videos and other information, and accounts for more than 80 percent of all data available.

“Focusing on unstructured data is what will give us the edge (over criminals) to be able to identify the very complex and organised collusive rings,” said IBM’s Clandillon.

source: interaksyon.com

Cybercrime hits financial firms hardest: survey

LONDON — Cybercrime is the second most common type of fraud reported by financial firms, more than double the level across other industries, as criminals turn increasingly to technology as their main weapon against banks, a survey showed.

Some 39 percent of financial services companies that suffered from economic crime last year said they had been hit by cybercrime, compared to 17 percent in other industries, according to the survey by consultancy PwC.

Banks in Europe and the United States are being told by regulators to toughen their defenses against cyber attacks, which have grown more frequent and severe as criminals and “hacktivists” become more sophisticated. Banks are often targeted for financial gain, but sometimes it is to disrupt business.

Hundreds of bankers took part in simulated “cyber attacks” last year in New York and London to test their resilience to such threats.

PwC said its survey even appeared to underestimate the scale of attacks, saying its experience showed a clear majority of financial firms had suffered cybercrime last year.

“Cybercrime is growing and the methods are constantly evolving. We see no abatement in attacks on banks’ infrastructure,” said Andrew Clark, a partner in PwC’s forensics practice.

Some 45 percent of financial firms were victims of fraud last year, PwC’s 2014 global economic crime survey showed. The survey, based on responses from 1,330 companies in 79 countries, showed theft was responsible for the highest share of economic crime, followed by cybercrime, money laundering, accounting fraud and bribery and corruption.

External fraudsters are behind most of the economic crime. The survey said most internal frauds were committed by junior staff or middle managers.

The profile of the typical internal fraudster is a male aged 31-50, with a university education.

source: interaksyon.com

From robbers to vendors, Swedes brace for cashless future

STOCKHOLM — Peter, 55 years old and homeless, is standing at a Stockholm supermarket, carrying the two objects that help him make a living: a stack of magazines and a debit card reader.

The magazine, Situation Stockholm, is sold by the poor to bring in some income, but for Peter and many other vendors the problem in recent years has been that cash is falling out of use, and passers-by often don’t have 50 kronor (5.70 euros, $7.80) at the ready to buy a copy.

The card reader, provided by the magazine’s publishers, has come to the rescue, and Peter, who asked not to be identified by his last name, couldn’t be happier.

“Customers can follow every step so that they don’t feel cheated,” he said, showing the functions of the device. “I’m impressed by this thing. It’s cool.”

Mattias Stroemberg, a potential customer taking a look at Peter’s magazines, welcomed the opportunity to pay with cards: “I never carry cash around. No one does anymore.”

In Sweden, only 27 percent of retail sales are made with cash, according to a recent paper by the European Central Bank. If online sales were included, the figure would be even smaller.

All the Nordic countries are rapidly on the way towards a cashless society, deepening an existing divide between north and south in Europe. In Greece and Romania, for example, 95 percent of transactions are still in cash.

Not everyone in Sweden cheers the transition. In a celebrated case, a would-be robber entered a Stockholm bank, but had to leave empty-handed, discovering that he had picked a cashless bank.

Criminals are not the only ones affected. From Copenhagen to Reykjavik, the cashless society has profoundly changed the ways people live.

Everything from hot dogs to taxes is paid for online, with bank cards, or by SMS. Many buses refuse cash — confounding foreign tourists — and the newly opened ABBA Museum in the Swedish capital also only accepts credit and debit cards.

“Neither retailers nor banks have any obligation to accept cash,” according to the nation’s central bank, the Riksbank.

‘A society where cash is reduced to a minimum’

“We’ll probably not see a totally cashless society in the near future, but a society where cash is reduced to a minimum and used in very few situations, is probably quite realistic,” said Niklas Arvidsson, a researcher at the Royal Institute of Technology in Stockholm, who published a study on the topic earlier this year.

The big winners are the banks and card companies, but in the end, all of society could benefit as cash is more expensive to handle than electronic payments, he said.

But the elderly and rural citizens, as well as the socially marginalised with high credit risk such as the long-term unemployed, would have problems if cash disappeared completely, he argued.

“If our society goes in this direction, that you basically can’t do anything at all without access to debit or credit cards … it might even create further marginalisation and exclusion,” said Leif Oeberg, development director at the Swedish Salvation Army, which offers support to people in need.

“The absolute and almost immediate effect … is that you can’t travel by bus. What we see at the other end of the spectrum is that the most marginalised get around on foot … or travel (by metro) without a ticket, but you can’t do that on the bus. That is the stark reality for people today,” he added.

There exists an alternative — pre-paid debit cards that people can later recharge at convenience stores, but with a minimum of 200 kronor (22 euros, $30) even this can pose difficulties.

Arvidsson also warned that consumers’ rights might be at risk as the electronic trail every card user leaves behind could be misused for marketing purposes.

“There is a concern that today’s laws are insufficient,” said Arvidsson. “The authorities must ensure that the information is used correctly.”

Other losers in the cashless game are smaller shops struggling with high card fees, especially after Sweden implemented a new law in 2010 that banned imposing surcharges on customers for paying with cards.

That means the retailers themselves must deal with the fees to the card-issuing companies — up to 2.50 kronor per transaction, plus an additional percentage fee.

Since 70 percent of all retail transactions in Sweden are by card, both debit and credit, it adds up to a sizable sum.

Retailers include the fee in the prices of their products, but for smaller shops it’s a problem because they don’t have the economies of scale and thus have a hard time keeping prices low.

For reasons such as these, Swedish money is not about to go completely virtual.

The Riksbank, which having been founded in 1668 is one of the world’s oldest central banks, still plans to launch new banknotes and coins in 2015.

“We believe cash will continue to exist in the near future. We can’t foresee it disappearing completely,” said Christina Wejshammar, head of the banknotes and coins division at the Riksbank. “It all depends on how we act as consumers.”

source: interaksyon.com

Banks shutter branches along path of 'Yolanda'

MANILA – Banks in areas along the path of Typhoon ‘Yolanda’ have suspended operations.

In an advisory, United Coconut Planters Bank (UCPB) announced that the following branches in the Bicol region, Visayas and Mindanao will be closed today:







Daet
Legaspi
Masbate
Naga
San Jose
Sorsogon
Banilad
Calbayog
Carbon
Dumaguete
F. Ramos
Iznart
Jaro
Jones Avenue
Kalibo
Lacson Galo
Libertad
Mabini
Mabolo
Mandaue
Mango Avenue
North Drive
Roxas
San Juan
SM City Cebu
Tacloban
Tagbilaran
Butuan
Surigao

“We apologize for the inconvenience, but we are exerting our efforts to ensure the safety of all UCPB customers and employees,” the bank said.

In a separate notice, Philippine Veterans Bank (PVB) said it also closed the following branches in Bicol region, Visayas and Mindnao today because of the typhoon:

Tacloban
Catarman
Legazpi City (Albay)
Tagbilaran
San Jose (Mindoro Occidental)
Dumaguete
Cebu
Mandaue
Roxas City (Capiz)
Naga
Butuan
Iloilo
Bacolod
Cagayan de Oro
Kalibo

“We apologize for the inconvenience, but we are exerting our efforts to ensure the safety of all PVB customers and employees. We wish for the safety of our kababayans in areas now being affected by this massive storm,” PVB said.

Separately, Philippine Savings Bank said the following branches in the Visayas didn’t open today because of the typhoon:

Bacolod
Bacolod Libertad
Bacolod North Drive
Butuan
Cebu Ayala Business Park
Cebu Banilad
Cebu Capitol
Cabu Carbon
Cebu Colon
Cebu Jones
Cebu Lapu-Lapu
Cebu Mandaue AC Cortex
Cebu Mandaue National Highway
Cebu Mango
Cebu Subangdaku
Cebu Taboan

source: interaksyon.com

US tax probe leaves Swiss bankers afraid to travel: report

GENEVA - As a United States hunt for tax evaders and their accomplices gains momentum, many Swiss bankers are afraid to go abroad for fear of arrest, one business leader said in an interview published Sunday.

"In my opinion, some 1,000 Swiss bankers no longer dare to go to the United States, or even travel abroad," Martin Naville, the head of the Swiss-American Chamber of Commerce, was quoted as saying by Le Matin Dimanche weekly.

Swiss banks and industry representatives are increasingly cautioning bankers who have worked with US clients to refrain from travelling outside Switzerland, the paper reported.

Swiss banks are believed to have accepted tens of billions of undeclared dollars from US citizens, though they now refuse such money, and a number of banks are under US investigation.

The US has not made public which individual bankers it is probing, but according to Le Matin Dimanche, about 30 names are on the list.

Recently however, "the United States has proven it can strike where and when it likes, and now with the help of European countries", the paper wrote, describing widespread paranoia throughout the banking industry.

The report comes just over a week after the arrest in Italy of a former high-ranking UBS executive alleged to have helped US customers conceal their assets.

Raoul Weil, the 54-year-old ex-chairman of UBS's global wealth management service, was indicted by a US federal grand jury in 2008 for his alleged role in overseeing the US cross-border business.

The indictment alleges that Weil and co-conspirators helped US customers hide around $20 billion (15 billion euros) in assets from tax authorities.

The Swiss national, who left UBS after the 2008 indictment, has always denied the charges and is reportedly fighting his extradition from Italy to the US.

The Swiss Bank Employees Association told Le Matin Dimanche it was advising all bankers who have regularly visited clients in the US "to abstain from travelling".

And some Geneva banks are urging employees living on the French side of the border to settle in Switzerland instead to avoid problems, one banker who wished to remain anonymous told the paper.

"I don't even dare leave Zurich anymore," said another unnamed banker, who recently found out his name had been handed to US authorities.

source: interaksyon.com

JPMorgan Chase on US default: 'You don't want to know'

WASHINGTON - Top US banker Jamie Dimon of JPMorgan Chase warned Saturday that the United States needs to avoid defaulting on its debt, saying the possible repercussions are unfathomable.

"You don't want to know," Dimon said when asked what would happen if the US is forced into default because Congress did not raise the country's borrowing limit.

"It would ripple through the world economy in a way that you couldn't possibly understand," he said at a discussion held by the Institute of International Finance, a leading forum for the world's banks.

He said it would shock the money market, where trillions of dollars in cash are invested in ostensibly top-quality securities like US debt based on expectations that the borrowers will not default.

"You don't know the ripple effect of that through money-market funds," stressed Dimon, head of the largest US bank by assets.

"The money markets are the most fickle markets in the world, they're like a rabbit."

Dimon was speaking as the White House and congressional Republicans remained deeply at odds over passing a budget and raising the US debt ceiling, a move needed to ensure the government can continue to pay its bills.

The US Treasury has repeatedly warned that as soon as October 17 it will be short of cash and forced to default on its obligations, though not saying whether it would skip debt payments or others, like social security payments to retired Americans.

With no compromise apparent, and the government partially shut down now for 12 days due to lack of a budget, Dimon warned that the deadline was looming.

"As you get closer to it, the panic will set in," he said.

On the other hand, he emphasized: "The US cannot default. I think every responsible person knows that."

source: interaksyon.com

Banks ordered to provide more detailed info on credit card business

MANILA - The Bangko Sentral ng Pilipinas (BSP) is requiring banks and other financial institutions to submit monthly credit card business activity reports (CCBAR) containing data on credit card issuers, cardholders, complaints, and card use location.

The BSP intends to enhance its credit card database to ensure transparency and availability of information on credit card operations and complaints resolution, and afford analysis of the credit card industry for policy-making.

The new rules are contained in Circular 812.

The CCBAR, which will be submitted in monthly, aims to ensure consumer protection as well as managing risks involved in credit card transactions, banks/quasi-banks including subsidiaries and affiliates.

The BSP aims to capture more credit card data, including the number of credit card holders in the country. To date, the BSP regularly reports data on credit card receivables of banks, including that portion which is non-performing.

Credit card receivables climbed 11 percent to P131.9 billion in the first quarter, from P118.8 billion in the same three-month period last year. Universal and commercial banks held bulk of the receivables at 82.6 percent, with their subsidiaries cornering the remaining 17.3 percent.

Non-performing receivables increased to 11.2 percent of total credit card transactions, but eased to 13 percent of big banks' total amount of bad loans.

Recently, the BSP issued new rules to strengthen the security banks and non-bank financial institutions' electronic products, including credit cards.

The regulation requires BSP-supervised institutions to adopt end-to-end Triple Data Encryption Standard (3DES) for the whole ATM network by January 1 and shift from magnetic stripe technology to more secure WMV chip-enabled cards by August 1, 2017.

source: interaksyon.com

Withdrawing money from ATMs to cost more starting next month

MANILA - Two of the country's biggest banks are set to increase ATM transaction fees next month to defray the higher cost of "enabling interbank withdrawals and other services."

In an advisory, Metropolitan Bank and Trust Co said its cardholders will be charged P15 when using other banks' ATMs and P7.50 when using Philippine Savings Bank ATMs.

PSBank is the thrift unit of George Ty-owned Metrobank, whose cardholders would however be charged zero if they use its network of ATMs. The new fee structure would take effect on October 1.


The country's second biggest bank in terms of assets, Metrobank closed the first semester with 832 branches and 1,822 ATMs nationwide.

In a separate advisory, Bank of the Philippine Islands (BPI) said its cardholders would be charged P15 per transaction starting next month -- up from P10 -- when withdrawing through any of the ATMs of Bancnet, Expressnet and Megalink.

BPI cardholders however can still withdraw from the bank's ATMs at no cost. The new ATM fee schedule would take effect October 22.

With at least 1,700 ATMs nationwide, BPI is the country's third biggest lender in terms of assets.

“This increase is necessary to enable us to maintain our service standards even for transactions using other banks' ATMs,” the Ayala-owned bank said.

“Since the last fee adjustment in 2005, the costs of enabling interbank/inter-network ATM withdrawals and related services have escalated. It is our commitment to ensure your transactions, wherever and whenever made, will be seamless and efficient,” BPI said.

The Bangko Sentral ng Pilipinas (BSP) said banks have latitude in making product pricing decisions.

However, the BSP could look into it and decide if there’s a need to take action in the public interest, weighing cost, availability and competitive conditions among other considerations, BSP Deputy Governor Nestor A. Espenilla Jr. said.

“It’s a business judgment but that should also consider customer reaction that can have a severe
backlash. So they must decide carefully and responsibly,” he added.

source: interaksyon.com

Citibank, Visa launch contactless credit card payment scheme

MANILA - Citi and Visa have introduced the first contactless credit card payment technology in the Philippines.

Called the Citibank Visa payWave, the new product is expected to widen Citi’s share of the local credit card business, which is contributing half of its revenues in the country.

Bea Tan, Citi consumer business manager, said the bank’s sales posted a good double-digit growth in the first half of the year on the back of the country’s sustained economic growth.

“It’s (sales) actually been pretty good. In the first half of the year, our growth has exceeded our expectations. The country is doing well in terms of drivers and profitability. It’s good to see that the country is growing so that we’re introducing innovation to our customers. Hopefully, this will change the payment behavior of our customers,” Tan told reporters during the payWave launch last week.

She said the innovation in the mode of payment for credit card transactions would support growth in the bank’s consumer business.

Tan said the bank’s credit card business contributes 50 percent of its total sales. Citi has 1 million credit card holders in the country, where it has a 20 percent share of credit card transactions.

 “In 2014, we foresee that given that the economy is doing very well for us, we will be able to open up more segments. We’re looking at high double-digit growth for next year in terms of customer acquisition. It will be something we can focus on next year,” Tan said.

Iain Jamieson, Visa country manager, said the credit card transactions would increase significantly, particularly the frequency of credit card use.

“Contactless payments will spur the country’s evolution towards cashless society,” he said.

With the new Citibank Visa payWave, cardholders can simply wave their cards in front of a Visa payWave reader to pay for their goods. The contactless payment would reduce time waiting in checkout queues for everyday purchases such as groceries, fastfood meals, coffee, and movie tickets.

The Citibank card holders don’t need to sign for purchases below P2,000 but are given the option to collect the receipt.

On average, Visa payWave transactions can be up to three times faster than cash payments, reducing queuing times for both cardholders and retailers.

“We are delighted to introduce our clients to a new way to pay with their credit cards where they simply wave, pay and go,” Citi country officer Batara Sianturi said.

Citibank has seven merchant partners so far, including Coffee Bean and Tea Leaf, Eastwood Cinemas, Lucky China Cinemas, McDonalds, Mercury Drug, Newport Cinemas and Robinsons Supermarkets.

Citi also has pioneered mobile-based payments with credit cards, real time account inquiry with SMS and account management convenience with combined credit limit for multiple Citi cardholders.

source: interaksyon.com

Bank of America's Newest Credit Card Pays You to Repay Them

A new credit card from Bank of America (BAC) will offer cash rewards up to $120 a year to cardholders who pay off more than the minimum balance every month.

The BankAmericard Better Balance Rewards card gives cardholders $25 per quarter as long as they always pay their bill on time and pay off more than their monthly minimum due amount. Cardholders who also have a Bank of America bank account get another $5 each quarter, bringing the total to $120 a year just for staying on top of their bills and making an effort to bringing down their debt. The rewards can be cashed out or put toward your credit card balance.




That's a very different rewards program than you see on standard rewards cards, which focus on getting cardholders to spend as much as possible to get cash back. And while those rewards cards tends to be geared toward people with excellent credit, the Los Angeles Times notes that this card is likely to be aimed at lower-income consumers with fair credit.

So is the card a good deal?

The rewards are certainly attractive. To get $120 in annual cash rewards on a standard rewards card with 1 percent cash-back, you'd need to spend $12,000 in a calendar year (though bonus categories with rewards of up to 5 percent can allow you to get there more quickly).

By contrast, you don't have to rack up a ton of spending on this card to get a comparable cash bonus. In fact, even if you have only a $15 minimum payment, you could put a measly $20 on the card every month, and as long as you're paying a little more than the minimum due amount, you'll reap the rewards. If you also have a bank account with Bank of America, that means you could wind up getting $120 in bonuses on $240 of spending, a tidy 50% cash-back rate.

But that same feature also means that the card doesn't necessarily encourage people to make a serious dent in their balances. Because the cardholder need only pay "any amount more than the monthly minimum due" to get the cash bonus, simply paying a dollar over the minimum would be sufficient to get the rewards. A better incentive to encourage responsible borrowing might be to require cardholders to pay a minimum percentage of their total balance.

Another issue is that the annual $20 perk for holding an account with Bank of America might backfire on some consumers. The card, after all, is aimed at lower-income customers, who may not be able to maintain the necessary minimum account balance to avoid Bank of America's monthly account fees. If you're considering this card and you're currently with a bank or credit union that doesn't charge a monthly maintenance fee, you should examine Bank of America's fee structure to make sure that switching banks won't cost you considerably more in the long run.

As with any other credit card, then, you'll need to examine your own personal finance habits to determine whether it's a good fit for you. Played the right way, the Better Balance Rewards card can help you make some easy money without significantly altering your spending. Just don't be fooled into thinking it's a magic bullet for eliminating your credit card debt.


source: dailyfinance.com

Most Americans Have More Savings Than Credit Card Debt

Rumors of the spendthrift American consumer may be slightly exaggerated. Bankrate's 2013 February Financial Security Index found that a majority of consumers -- by a narrow margin -- say they have more savings than credit card debt.

For more than half the country, 55 percent, an emergency fund outweighs credit card debt. Nearly a quarter, 24 percent, admit to having more debt on plastic than money in the bank, while 16 percent say they have neither credit card debt nor savings. That puts 40 percent of the population close to the edge of ruin while everyone else seems to be sitting pretty.

If most people have more savings than credit card debt, "Why are so many people broke?" asks Howard Dvorkin, CPA and founder of ConsolidatedCredit.org.

It's a curious question. The answer may be that although credit card balances came down through the financial downturn that began in 2007, consumers' fundamental behavior of not saving enough did not change.

According to the Department of Commerce, for 2012, the overall savings of the average household were 3.9 percent, much better compared to the 0.9 percent Americans were saving in 2001. However, this is down from the average 5.4 percent savings rate in 2008.

Even with a low savings rate, why wouldn't a supposedly low credit card debt rate put Americans in better financial shape?

"The fact of the matter is that America is broke -- whether it's mortgages, student loans or credit cards, we are broke. The old rule of thumb is that people should have six months' of savings," Dvorkin says."If you talk to people, most don't have two pennies."

Who's In Trouble?

In Bankrate's survey, men were more likely than women to say their emergency fund outweighed credit card debt, at 60 percent, compared to 49 percent of women.

But credit card debt hits all kinds of consumers. Bankrate's survey has found that roughly a quarter of all income levels has more credit card debt than savings.

"Credit card debt will eat you alive no matter who you are," Dvorkin says.










Those people with incomes more than $75,000 were less likely to have no savings or credit card debt compared to those at the opposite end of the spectrum, with incomes less than $30,000. Only 7 percent of high earners have no credit card debt or savings, while 28 percent of the bottom rung of earners say they aren't in debt but have no savings.

While staying out of credit card debt is a good place to be,having no savings puts low-income earners in danger of falling into a payday-loan cycle or needing to borrow from family or friends.

"People who earn less than $30,000 may not have the credit score to get credit cards. That keeps them from getting into trouble with debt, but it also keeps them from saving," says Xavier Epps, CEO and founder of XNE Financial Advising in Woodbridge, Va.

For the rest of the population, there may be a fundamental divide between consumers who are fine with carrying credit card balances and dedicated savers who strictly avoid debt.

"It tends to be that debt and savings are very lumpy; you rarely find someone that has both. It's either someone has a lot of debt and little to no savings, or someone has savings and very little debt,"says Elliott Orsillo, CFA, co-founder of Season Investments in Colorado Springs, Colo.

"There isn't much of a fluid spectrum of people with a ton of savings and no debt and a nice mixture down to people with no savings and lots of debt. It's usually either one or the other," he says.

"One of my clients had $400,000 in credit card bills. He came to me because it was impeding his ability to fuel his jet. The credit card companies would not allow him to charge his fuel anymore," he says.

No matter how much money you have coming in, learning to save and live beneath your means is the key to getting ahead.

source: dailyfinance.com

HSBC raises growth forecast for Philippines

MANILA - HSBC has upgraded its growth forecast for the Philippines on the back of government spending, loose monetary policy and an improving global economy.

In a research note, the London-based bank said it raised its forecast to 5.9 percent form the initial estimate of 4.9 percent.

HSBC said the Philippines would grow faster than initially predicted, given signs of recovery in Japan and the US, and of accommodative monetary policy around the world.

For the first quarter of this year, HSBC sees Philippine gross domestic product (GDP) growing 6 percent, slower than the 6.8 percent in the fourth quarter of 2012. Growth would further slip to 5.7 percent and 5.4 percent in the second and third quarters, respectively, before picking up to 6.5 percent in the fourth quarter.

This would bring full-year growth to 5.9 percent, or a tad lower than the government's full-year target of 6-7 percent.

Trinh Nguyen, HSBC economist, said the bank expects Philippine exports to benefit from "Abenomics," referring to the economic policies of Japanese Prime Minister Shinzo Abe.

Nguyen said domestic demand would remain the main prop for Philippine GDP, adding that remittances would stay steady this year and expand by 6.3 percent given more job contracts in the Middle East and Asia.

The country's growth story is also supported by positive political and macro news, with the Aquino administration gaining public trust, as shown by surveys, due to its fiscal consolidation and anti-corruption thrust, Nguyen said.

Because of the "sensible" fiscal and monetary policies, the country will likely earn an investment grade status from the major credit rating agencies by the second half of this year, she said.

While the Philippines has enjoyed strong portfolio inflows, the same cannot be said of the job-generating foreign direct investments (FDI), HSBC said.

It said foreigners are still wary of putting their money into factories and other long-term bets, as shown by the lackluster performance in the area of FDI, flows of which were flat in the first 11 months of last year at $1.2 billion.

"FDI inflows are more indicative of investors’ perceptions of the government’s progress in resolving long-standing challenges. While attaining an investment rating upgrade will likely have a positive effect on FDI inflows as funding becomes cheaper for corporations, foreign investors will be watchful of reform momentum such as improving electricity production, transportation, and most importantly easing restrictions on foreign ownership," Nguyen said.

She said reform in foreign ownership, for one, would take long in coming, the earliest in 2016 when President Benigno Aquino III "can afford to use his political capital to change the Constitution."

Another bane of the country is the underperformance of the Aquino administration's public-private partnership (PPP) scheme, leaving government to shoulder most of the infrastructure spending, which in turn would hinge on tax collection improvements, HSBC said.

In this regard, the Aquino administration would have no choice but to increase tax rates of expand the tax base, starting with the mining sector reform, the bank said.

"At the moment, both seem politically unviable. As such, FDI inflows will continue to underperform in the coming years," Nguyen said.

While surveys indicate that the upcoming mid-term elections would lean towards the administration party winning, HSBC said the more crucial signal is succession after Aquino steps down in 2016.

"What’s more noteworthy to watch is the replacement of President Aquino in 2016, which would signal whether the reform momentum in the Philippines will be sustained. While a foundation is laid, reforms to long-standing challenges are still required. With the international community cheering it on, this is an opportunity that leaders of the Philippines should not squander," Nguyen said.

source: interaksyon.com

PLDT borrows $300 million to refinance debt

MANILA - Philippine Long Distance Telephone Co has borrowed $300 million from foreign banks to refinance existing debts.

On the sidelines of the Philippine Investments Forum 2013, Annabelle Chua, PLDT treasurer on Wednesday, said the fresh loan was signed last January.

Last November, PLDT borrowed P6.20 billion. It also raised P8.80 billion worth of fixed-rate corporate notes to a group of primary institutional lenders to refinance its existing debts.

At end-September, PLDT's total debt stood at $3.1 billion, including the $500 million owed by Digital Telecommunications Philippines Inc (Digitel), which PLDT acquired in 2011. Digitel operates Sun Cellular.

In the first nine months of 2012, PLDT's net income fell by 6 percent to P28.7 billion from the previous year's P30.6 billion.  For the third quarter alone, its profit slipped to P9.21 billion from P9.32 billion a year ago.

Consolidated service revenues rose 12 percent to P126.24 billion from P112.27 billion in 2011. In the third quarter, service revenues climbed to P41.52 billion from the previous year's P36.65 billion.

InterAksyon.com is the online news portal of TV5, a member of the PLDT group.

source: interaksyon.com

Ways to Renegotiate Your Mortgage

If you are like many Americans struggling to make your monthly mortgage payment, you are not alone.  While the current economy has many struggling, the good news is that banks are more likely now to work with you than ever before.

Because banks have had to foreclose on so many homeowners, they would rather negotiate with you than have another foreclosure where they will likely lose money.  Banks want to get paid, and they now understand that the best way to get their money is to work with you, the borrower.

What You Need Before You Begin to Renegotiate

If you would like to renegotiate your mortgage, you will need several documents to prove that you are having a hard time making your payments.  You’ll want to round up your credit card statements, loan statements, unemployment information (if applicable) or your last paycheck stub, your last two years’ tax returns, and your checking and saving information as well as possibly other investments you have.

Ways to Renegotiate Your Mortgage

There are two main ways you can renegotiate your mortgage.  Which way you chose depends on several variables.

1.  Work with the lender.  Call the lender and honestly tell them that you are having a hard time making your monthly mortgage payment.  You will need to also tell them why you are having trouble, whether that be because of job loss, an injury or illness or another reason.

Ideally, the best time to work with the lender is before you fall behind on your payments.  This was not traditionally the case, but times have changed, and the lender wants to hear from you and work with you as soon as possible.

2.  Consider refinancing.  If you have more than 10% equity in your home and a credit score of 720 or higher, you may be a good candidate for a refinance.  Refinancing can lock you into a lower interest rate and give you a lower monthly payment that you will be able to afford.

While you may initially work with your own lender on a refinance, that is not your only option.  You can contact a mortgage broker who can help you find the best offers, or you can look around yourself and compare rates.  If you belong to a credit union, don’t forget that credit unions often offer lower rates than banks do.

In addition, consider changing the terms of your loan.  If you have a fixed rate mortgage, a 5 year adjustable rate mortgage may give you some breathing room with a lower interest rate and lower monthly payment.  This alternative is especially attractive if you plan to move within 5 years.

If you are having trouble making your mortgage payment, don’t despair.  You are certainly not the only one who has been in this situation, and you will likely find your lender willing to work with you.  Even if your lender isn’t, there are likely other lenders who will work with you and be glad to get your business.  Remember, in general renegotiating your existing mortgage is easier than getting a new mortgage.

source: everythingfinanceblog.com