Business Banking news and advice

All the latest business banking news and top tips to help stay up to date on business banking trends and products.

Westpac reduces business loan rates

Westpac reduces business loan rates

Bosses at Westpac believe that companies across Australia need all the help they can get at the minute, as trading conditions remain tough. Company representative Jason Yetton announced that the lender has lowered the interest rates attached to its business loans by 0.5 per cent. This comes after the Reserve Bank of Australia (RBA) reduced the official national cash rate by 50 points on Tuesday (May 1st). The pressure is on Australian banks to pass the cuts on to firms throughout the nation and Westpac is the third of the "big four" to do so. ANZ is set to make a decision next week. Westpac has also trimmed its mortgage rates by 0.37 per cent to 7.09 per cent. "We want to continue to help both our business and mortgages customers, while maintaining attractive high interest rates on deposits," Mr Yetton remarked. He added that the RBA's decision to slash interest rates was just one of numerous factors behind Westpac's latest move. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Business banking customers are not happy

Business banking customers are not happy

Entrepreneurs have had a tough time of things in recent months, as trading conditions have worsened. Companies have been blighted by the strength of the Australian dollar and a lot of firms have been forced to tighten their belts. A new study conducted by Roy Morgan Research indicated that confidence levels among business banking customers are low. The report suggested that fewer organisations are satisfied with the service being provided by their bank, which could prompt more companies to look for a more favourable deal. According to the index, levels of satisfaction were measured at 65.6 in March 2012, which was 0.7 per cent down on February. It also represents the first decline since July 2011. Representatives of Roy Morgan Research said that many firms feel their bank fails to communicate with them regularly enough. There is also a lot of resentment towards banks because some have hiked the interest rates on their business loan packages. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Business demand for credit cards grows sharply

Business demand for credit cards grows sharply

A growing number of Australian companies have been applying for credit cards, new figures have shown. Economists have been voicing their concerns over the apparent lack of demand for business loans, which they believe can harm economic growth, as firms are unable to expand. However, a new Veda report has shown that business credit inquiries increased by 8.8 per cent in the first quarter of the year, compared with the corresponding period in 2011. Much of the extra demand, as expected, was driven by organisations in the booming mining states, with the Northern Territory being a particularly lucrative market for lenders. Head of commercial risks at Veda Moses Samaha said that small and medium-sized enterprises (SMEs) across the nation have also been securing credit. Unlike businesses in the mining industry, these SMEs have not been looking to expand, but have become reliant on credit for cash flow purposes, which Mr Samaha thinks is a concern. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Business banking customers to miss out on rate cuts

Business banking customers to miss out on rate cuts

The Reserve Bank of Australia (RBA) is expected to sanction further cuts to interest rates next month, but business banking customers should not start celebrating just yet. Entrepreneurs have been pleading for a rate reduction since the turn of the year, as companies are being crippled by sizeable repayments on their business loans. The RBA made two successive readjustments in November and December 2011, but has not made any changes in 2012. Lower than expected inflation figures will prompt the central bank to make amends very soon, but AMP Capital Investors chief economist Shane Oliver believes Australia's major banks will not pass all of the savings on to their corporate customers. He told the Mercury that if the RBA reduces the cash rate by 25 points, business owners are only likely to see lending rates fall by between ten and 15 points. Therefore, Mr Oliver stated that a 50-point drop would be more suitable. This is especially true in light of reports that the nation's major banks are actually considering hiking rates on their business products and home loans in the near future. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Aussie banks plan to sell off business loans

Aussie banks plan to sell off business loans

Companies throughout Australia have been wary of securing finance from the nation's banks, mainly due to the uncertainty surrounding interest rates. The strength of the Aussie dollar is blighting many organisations, as people down under can buy cheaper items from abroad and trading conditions have remained tough. Banks have also suggested that intense funding pressures have made it more difficult to offer attractive business loans. As a result, the nation's major institutions have decided to sell syndicated corporate loans to funds for the first time, Reuters reports. In the past, banks have generally kept high quality loan deals on their books, but this is no longer cost effective. National Australia Bank is the most prominent business lender in the country and executive general manager for capital markets at the firm Steve Lambert said this landmark action was much needed. "These assets when sold will take some funding pressure off the banking system and free up banks' lending capacity," he was quoted as saying. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Business conditions 'are only slightly improved'

Business conditions 'are only slightly improved'

Trading conditions across Australia improved marginally in the first quarter of 2012, although the country's economic growth remained broadly flat. Many companies have bemoaned the high value of the Australian dollar in recent months, as people are finding it far cheaper to buy goods from overseas. The economic climate has also put many enterprises off taking out business loans, especially while the national cash rate remains at 4.25 per cent. A new business conditions index published by National Australia Bank (NAB) showed that corporate activity was measured at three points, which was up from two points in the fourth quarter of 2011. Despite the slight upturn, NAB's chief economist Alan Oster said the economy was "going sideways" and the gap between mining companies and firms in other sectors is still worryingly large. "The divide between the stronger mining and serviced-based sectors and the weaker consumer and trade-dependent sectors remained a marked feature of the economy in early 2012," he remarked. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Business lending down in February, new figures show

Business lending down in February, new figures show

The number of companies taking out business loans fell sharply in February 2012, reigniting fears that economic growth will be subdued this year. New figures released by the Australian Bureau of Statistics have indicated that total commercial finance commitments were down by 8.4 per cent during the month, following on from a 1.5 per cent dip in January. Revolving credit arrangements fell by 26.6 per cent in February, despite a rise of 0.3 per cent the previous month. Many company owners and trade unions have urged the Reserve Bank of Australia (RBA) to lower interest rates in order to give struggling enterprises a helping hand. However, it seems the country's major banks are increasingly setting their rates independently of the RBA, with ANZ announcing last week that the rates attached to its business packages would go up by 0.06 per cent. Entrepreneurs are worried that other lenders will follow suit, leaving Australian enterprises with even more financial problems. Have a question about business banking? Ask the money gurus at Mozo Answers.

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ANZ announces interest rate hike

ANZ announces interest rate hike

Company bosses have been urging banks to lower their interest rates in recent weeks, but unfortunately their calls appear to have fallen on deaf ears. The Reserve Bank of Australia (RBA) has been criticised by trade unions for its failure to enforce rate cuts so far in 2012. Business owners believe firms are facing a constant battle to remain profitable while the standard cash rate remains at 4.25 per cent. However, ANZ announced today (April 13th) that it will be hiking the interest rates attached to its business loans by 0.6 per cent from April 20th. This will add the equivalent of $1.50 per week to repayments of a loan in the region of $130,000, the company confirmed. The increase is also being applied to home loans and chief executive officer at the bank Philip Chronican said higher lending costs have forced the company to take these measures. "We accept our response to the new funding environment is difficult for some of our customers – even though deposit customers have benefited from better rates," he remarked. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Businesses are still getting access to capital, says NAB

Businesses are still getting access to capital, says NAB

Trading conditions are increasingly tough for companies down under and many entrepreneurs have complained about how difficult it is to secure credit from banks. Following the economic downturn in 2008-09, many lenders were forced to tighten their purse strings and lots of banks were unwilling to issue business loans to high-risk customers. However, National Australia Bank's (NAB) business banking group executive Joseph Healy has told the Australian Associated Press that although the recession made things more difficult, firms can still get access to funding. He said the NAB is still keen to support small enterprises, but it must be more responsible about who it lends money to. NAB accounts for around a quarter of all business loans handed out across the country and he believes that being able to obtain capital is vital if companies want to avoid stagnation. "A more prudent approach to lending, generally speaking, is in everybody's interest," he was quoted as saying. Have a question about business banking? Ask the money gurus at Mozo Answers.

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Rate cut needed to ease business banking pressure

Rate cut needed to ease business banking pressure

Companies throughout Australia are finding it increasingly difficult to remain profitable while the dollar retains its high value. Lots of firms – particularly small upstart enterprises – are reliant on loans in order to grow, but with standard interest rates still at 4.25 per cent, many are struggling to find suitable business banking options. Indeed, the Reserve Bank of Australia (RBA) has opted not to lower rates this year and this prompted some institutions to hike the rates attached to packages such as business loans. The Australian Chamber of Commerce has urged the RBA to reduce the cash rate by 0.5 per cent as soon as possible so that corporations can get easier access to credit. Chief executive of the organisation Peter Anderson insisted that urgent action is needed to stimulate more economic growth down under. "The time has come for Australia's central bank to move decisively to cut rates by a full half a per cent and for the retail banks to immediately pass it on," he remarked.

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