08/10/2008 - 06:44

Today's Business Headlines

08/10/2008 - 06:44

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'Thousands' of jobs in doubt as CBA prepares to snatch BankWest; Merger to create $10bn bonus: BHP; Iron ore producers steel themselves for a slide; $500m windfall in $A plunge; Mitsui walks from Crux project

'Thousands' of jobs in doubt as CBA prepares to snatch BankWest
WA is poised to get a taste of the widespread job losses hitting cities around the world, with the Commonwealth Bank refusing yesterday to rule out a staff cull and branch closures if its $2 billion-plus takeover of BankWest goes ahead. The West

Merger to create $10bn bonus: BHP
BHP Billiton's $US100 billion ($139 billion) bid to create a super miner with Rio Tinto would lead to a boost in the nation's annual iron ore exports by 70 million tonnes above where they would otherwise be from 2015, the miner says. The Australian

Iron ore producers steel themselves for a slide
The iron ore sector -- once the darling of the resources boom -- is starting to feel the pinch of tougher global market conditions but analysts predict its long-term outlook is still sound. The Australian

$500m windfall in $A plunge
The sharp fall in the Australian dollar is set to deliver a $500 million windfall for the state government, potentially funding much of the $675 million that Colin Barnett has agreed to set aside this year for the Nationals' royalties for regions program. The West

Mitsui walks from Crux project
Nexus Energy's hopes of approving its $1 billion Crux oilfield development in the Browse Basin off the Kimberley coast next month has suffered a huge blow after potential partner Mitsui pulled out because of the global financial turmoil. The West

 

THE WEST AUSTRALIAN:

Page 1: Borrowers will get their single biggest interest rate cut for 16 years - and are expected to be handed two more significant falls this year - after the Reserve Bank stunned markets yesterday by slashing one percentage point in response to the global economic turmoil.

Page 3: Thirty-six people were being treated for spinal and head injuries, fractures and cuts last night after a Qantas Airbus suddenly plummeted about 8,000 feet during a flight to Perth from Singapore.

WA is poised to get a taste of the widespread job losses hitting cities around the world, with the Commonwealth Bank refusing yesterday to rule out a staff cull and branch closures if its $2 billion-plus takeover of BankWest goes ahead.

Page 7: The sharp fall in the Australian dollar is set to deliver a $500 million windfall for the state government, potentially funding much of the $675 million that Colin Barnett has agreed to set aside this year for the Nationals' royalties for regions program.

Business: Commonwealth Bank will push ahead with talks to acquire Suncorp Metway's banking operations even with the banking giant poised to announce a $2 billion-plus acquisition of BankWest as early as today.

Nexus Energy's hopes of approving its $1 billion Crux oilfield development in the Browse Basin off the Kimberley coast next month has suffered a huge blow after potential partner Mitsui pulled out because of the global financial turmoil.

Troubled financier Allco Finance Group is seeking shareholders' approval to change a proposed $3.5 million options and rights package for chief executive David Clarke.

The litany of fortunes besetting property developer Saville Australia has prompted it to put its headquarters in the Perth CBD on the market and downsize to space less than one-quarter of the size.

Palandri's newly installed liquidator hopes to hold a public examination of the group's directors, auditors and advisers in the courts early next year in a bid to recoup millions of dollars lost by investors.

BHP Billiton's proposed $122 billion takeover of a reluctant Rio Tinto is as expensive as they come in terms of direct fees and expenses, with BHP estimating the cost at $US3.62 billion ($5 billion).

Budding Pilbara iron ore producer Atlas Iron has made two new hematite discoveries at its Pardoo project east of Port Hedland.

 

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: The Reserve Bank has aggressively cut official interest rates in a bid to keep the economy out of recession amid warnings that the worsening financial crisis is prompting a sharp downgrade in the country's growth outlook.

Confidence in the European banking system has been dented by reports that two of Britain's largest banks had discussed taking part in a government-funded bailout package.

Page 3: A new deal between the Australian Securities and Investments Commission and its US counterpart will allow the national regulator to track undisclosed short selling by US companies in the Australian sharemarket.

While a falling Australian dollar has meant a win for farmers and companies that do business overseas, some exporters are unconvinced of the benefit of a lower currency.

Page 5: Western Australia's Auditor General has added to the pressure on the new Liberal government to fix the state's onerous approvals process for resources projects, warning that a failure to find solutions could force mining companies to invest elsewhere.

World: A brief burst of confidence in European sharemarkets after the interest rate cut by the Reserve Bank of Australia has evaporated after a credit downgrade for one of the UK's largest banks sent share prices tumbling.

Markets: The sharemarket has spiked higher after the Reserve Bank shocked investors by slashing the official cash rate by a full percentage point and stirring speculation that other global central banks may also cut rates to prevent a worldwide recession.

 

THE AUSTRALIAN:

Page 1: Reserve Bank has signalled it will do whatever it takes to keep the Australian economy from sliding into a global recession, delivering a massive one percentage point cut in interest rates.

The Australian dollar has collapsed to a two-and-a-half-year low as fears grew that a global recession would end the commodities boom.

British banking giants Barclays and Royal Bank of Scotland have been named as the latest troubled institutions lining up for a government bailout as the global credit crisis continued to spread through the European financial system.

Page 2: The dollar has fallen further in the past three months than ever before in its 42-year history as world investors conclude that the commodity boom is over.

Page 3: Home lending rates began tumbling yesterday as the nation's banks moved swiftly to pass on most of the Reserve Bank's shock one per cent cut in official interest rates.

Page 4: The one percentage point cut to the official cash rate has provided a ''glimmer of hope'' for a recovery in the housing market and has lifted the spirits of retailers who feared poor trading in the lead-up to Christmas.

Beverage giant Foster's has been thrown a lifeline by the fall in the Australian dollar, whose strength over the past three years has dented export sales as foreign drinkers have switched to cheaper tipples.

Page 6: The federal Coalition is demanding ''far greater transparency'' in the allocation of money from the Rudd Government's Building Australia Fund to ensure it is not a ''slush fund'' before it will vote for legislation setting up the $20 billion infrastructure investment vehicle.

World: John McCain has called Barack Obama a liar in some of the harshest rhetoric of the campaign as the two candidates get set for their second presidential debate.

Business: The Reserve Bank's shock decision to cut the cash rate by one per cent has calmed panicked domestic financial markets, but experts believe long-term stability remains dependent on a global recovery.

Despite the worsening global financial crunch, the credit rating of leading Australian listed trusts had held firm -- for now.

Lehman Brothers agreed to pay a total of more than $US23 million ($31.7 million) to three executives leaving the securities firm just days before it collapsed, according to internal emails made public by congressional investigators.

Some of Lehman Brothers' top European and global bosses stand to make millions of pounds for three months' work helping the failed bank's liquidator to unwind its trades.

The Commonwealth Bank is close to finalising the $2 billion purchase of BankWest, after the nation's biggest bank confirmed yesterday it was in exclusive negotiations with HBOS, the target's British parent.

BHP Billiton's $US100 billion ($139 billion) bid to create a super miner with Rio Tinto would lead to a boost in the nation's annual iron ore exports by 70 million tonnes above where they would otherwise be from 2015, the miner says.

The iron ore sector -- once the darling of the resources boom -- is starting to feel the pinch of tougher global market conditions but analysts predict its long-term outlook is still sound.

 

THE SYDNEY MORNING HERALD:

Page 1: Homeowners will receive the biggest single reduction to their mortgage repayments in 16 years after a worried Reserve Bank slashed the cash rate by one per cent.

NSW Premier Nathan Rees is set to strip back RailCorp's top-heavy management in a move to reclaim the company under government control.

Page 3: The transport safety watchdog is investigating an accident that sent a Qantas passenger jet plunging earthwards suddenly, injuring at least 40 passengers and crew and forcing the pilot to make an emergency landing.

World: The disgraced CEO of US investment bank Lehman Brothers has been hauled in front of a congressional committee to explain his role in the world financial meltdown.

Business: Global interest rates are set to tumble after the Reserve Bank's drastic rate cut underlined the severity of the strains in the market and stressed the resolve of central banks to check the tide of worldwide recession.

 

THE DAILY TELEGRAPH:

Page 1: Homeowners will get around $160 a month slashed from their mortgage repayments after the Reserve Bank approved a one per cent reduction in official rates.

Page 3: Passengers and crew onboard a Qantas flight suffered broken bones after an in-flight upset forced the pilot to make an emergency landing at a country airport in Western Australia.

World: Hostilities are expected to boil over today as US presidential contenders John McCain and Barack Obama go head-to-head in their second debate.

Finance: Australia could still be heading for a recession despite the Reserve Banks drastic one per cent cut to the cash rates, say experts.

 

THE AGE:

Page 1: The financial markets shocked back to life by the unexpected one per cent cut in interest rates by the Reserve Bank. Homebuyers get biggest cut in home loan rates in 16 years.

Page 3: At least 10 passengers badly injured and another 50 hurt in Qantas flight bound for Perth.

Governor-General Quentin Bryce says paid parental leave vital for strengthening families.

World: Presidential candidates Obama and McCain take off the gloves as they shape for the second debate while polls show Obama surging.

Finance: Australian equities go against international trend staging comeback fuelled by one percentage point interest rate cut.

 

HERALD SUN

Page 1: Shock one percent interest rate cut gives relief to homeowners and sends share market soaring.

Page 3: Qantas jet in nightmare 350ft midair plunge over WA sends 10 people to hospital with serious injuries.

Page 5: The dramatic cut in interest rates brings joy to thousands of homeowners struggling to pay their mortgage.

World: Former head of failed Lehmann Brothers bank Richard S Fuld Jr grilled in congressional hearing about his $US500 million in earnings.

Finance: Further interest rate cuts expected over the next six months following the one per cent slash by the Reserve Bank.

 

CANBERRA TIMES:

Page 1: The RBA's announcement of a one per cent cut in official interest rates sparked a surge in the Australian stock market, defying overseas trends.

The Air Transport Safety Bureau is investigating a Qantas mid-air incident, when an Airbus A380-300 lost cabin pressure over Western Australia, injuring 36 passengers.

The ACT Liberals have pledged that if elected, they'll allow Canberrans to have a say in what artwork is installed around the city.

Page 2: Prime Minister Kevin Rudd has announced tough eligibility guidelines for the government's $76 billion infrastructure fund.

World: Both presidential candidates sharpen their attacks towards each other ahead of today's second televised presidential debate.

Finance: The Australian sharemarket rose two per cent higher yesterday after the RBA's one percentage point interest rate cut.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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