Boss spent big as car firm collapsed
and go away” phenomenon again took a toll, the ASX 200 financials index slumped 9.2 per cent across the 23 trading sessions of the month.
That is the biggest fall since August 2015, narrowly avoiding what would have been its seventh double-digit monthly decline in the past decade.
Among the big four banks, which collectively account for more than a quarter of the weight of the benchmark ASX 200 index, ANZ has been the worst performer. It shed 14.5 per cent for the month.
The sector has held back the broader bourse, with the ASX 200 itself down 3.4 per cent in May despite a solid period for the big miners, energy majors and telecommunications heavyweight Telstra.
The big four have careered into a wall built in Canberra.
The $6.2 billion bank levy unveiled with the Federal Budget sucked air out of the quartet, which have since agitated over how they will foot the bill.
They faltered further amid signs global banking regulators are poised to ratchet up the levels of capital reserves each will need – the price to pay for being “unquestionably strong”.
And despite a late flurry of bargain hunting yesterday, analysts say there are enough clouds over the banks to deter risk-averse investors.
“Why would you buy Aussie banks when there is nothing but negative news flow influencing price right now?” IG chief market strategist Chris Weston said.
Fears have manifested in three distinct ways, according to CMC chief market analyst Ric Spooner.
Political risk is the primary factor, with investors increasingly wary about the level of external controls on the sector. ALMOST half a year before car dealership Bryan Byrt collapsed, its boss chalked up tens of thousands of dollars in credit-card bills for holidays, top fashion stores and big lunches.
One holiday for Bryan Byrt principal Brendon Crowley at Palazzo Versace cost $15,592.29 – and was billed a month before receivers seized the iconic sevensite dealership in late 2014.
Bryan Byrt, which traded vehicles from Fords to Volkswagens, collapsed owing almost $70 million. Banks recovered some funds but small suppliers have not recovered a cent, while taxpayers covered $3.3 million in employee entitlements.
Brendon and his father John, also a Bryan Byrt director, and John’s wife Judy were bankrupted in April 2015 over related bank loans.
Now their bankruptcy has been under public examination in Brisbane’s Federal Court, called by their trustee John Shanahan of Gervase Consulting.
The court heard yesterday details of spending on Brendon’s American Express account; he and wife Tanya had cards.
Payments in March 2014 included $60,635 for a Fiji island resort and $1425 at a Louis Vuitton store. Between April and July, $2607 was spent at an Apple shop, almost $1200 at furniture store Coco Republic, $5638 at clothing store Ralph Lauren, almost $3500 at a men’s suit
Indications of an impending downturn in the housing market, on which mortgage lenders rely heavily for growth, and caps on investor lending, have crimped profit margins.
History suggests May will not mark an end to the downdraft.
June is the worst month to be invested in the ASX 200, which has tumbled by an average 3.1 per cent that month over the past four years. store, and $1380 at boutique Chanel. Another Louis Vuitton bill was almost $550.
“I don’t remember what we bought then. Obviously not much,” Brendon told the court.
The trustee’s lawyer Gerard Forde also walked through three days of eating out in July: $2083.50 at Brisbane upscale restaurant Blackbird, $237 at Brisbane’s Story Bridge Hotel and $391 at the Enjoy Inn.
The court heard hundreds of thousands of dollars were paid into the credit card account, and hundreds of thousands of dollars were paid in taxes via the card.
Brendon said he guessed the tax payments would be related to Bryan Byrt taxes and the source of some money also could have been Bryan Byrt. But he said Tanya paid the bills and he had “never looked at the Amex statement”.
Also appearing was John Crowley, who told the court he had largely stepped away from the Bryan Byrt business after selling a 51 per cent stake to Brendon in 2007.
John denied any knowledge of a system in which a contractor allegedly set up a second company which would invoice Bryan Byrt for advertising that was never done. Most of that money was then allegedly sent on to a trust of which John was trustee.
The examination finished yesterday. Now the trustee will look at the evidence to see if any action to recover funds is taken.