Mike Smith, the CEO of ANZ Bank (one of the big four Australian banks), has received a lot of press for criticising the Australian government veto of the takeover of the Australian stock exchange by the Singapore stock exchange. I guess he is making the running but he is an ineffective lobbyist.
Senior management of at least one other big four Australian bank (won't tell you which one) privately lobbied the Treasurer Wayne Swan against the merger. Their reason: Singapore is one of the dirtiest, most corrupt stock markets in the world and they did not want that syphilitic puss invading the Australian financial markets and in particular the Australian superannuation system.
You see Australia has a well-functioning and mostly honest privatized social security system we call “superannuation”. Its one of the great economic achievements of this country. It relies on a mostly honest financial market.
Singapore by contrast is one of the homes of Chinese fraud. At one stage a quarter of the volume of the Singapore stock exchange was so called S-Chips – Chinese stocks listed in Singapore – and they were every bit as scummy as the Chinese reverse mergers listed in New York. Singapore – in exchange for listing fees – allowed their population and their investment market to be raped by fraudsters. (If you don't believe me look up a few of the S-Chips on the Wikipedia S-Chip scandal page.)
Singapore came to Australia saying they ran an honest market.
At least one and possibly three of the big Australian banks knew they were lying.
Ultimately Wayne Swan knew they were lying.
He did the only decent thing and vetoed the merger and I applaud him for it.
Allowing that puss a place in the Australian market would be deeply damaging for the Australian superannuation system. And Wayne Swan knew it.
Now interestingly three of the big four banks in Australia have substantial positions in Australian superannuation. Westpac owns the old Banker Trust platform. National Australia Bank owns MLC. Commonwealth Bank owns Colonial. Only ANZ does not have a seat a the table. And so only ANZ – through their weakness – would not be a loser if the ultra-corrupt Singapore exchange got to control the ASX.
And ANZ does some trivial investment banking in Asia – so Mike Smith was talking his pocket book.
I know for sure at least one Australian bank lobbied against the merger. I lobbied a little against the merger too. But the merger was against Australia's interests and against the interest of three out of four of the big banks.
Wayne Swan – in vetoing the merger – acted clearly in Australia's interest against Singapore corruption. I could not be prouder of him.
Saturday, April 9, 2011
Posted by John Hempton at 12:31 PM
The content contained in this blog represents the opinions of Mr. Hempton. Mr. Hempton may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Hempton's recommendations. The commentary in this blog in no way constitutes a solicitation of business or investment advice. In fact, it should not be relied upon in making investment decisions, ever. It is intended solely for the entertainment of the reader, and the author. In particular this blog is not directed for investment purposes at US Persons.