<a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> has lodged plans for a $750 million, three-tower mixed-use precinct that would complete the long-running redevelopment of Carlton's former Carlton United Breweries site.

The proposal at <a href="https://www.apartments.com.au/new-apartments/185-195-queensberry-street-carlton-vic-3053">46-78 Bouverie Street and 185-195 Queensberry Street</a> spans a 6,468 sqm site, the last remaining undeveloped parcels within the former brewery's 2007 masterplan.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the development will comprise two purpose-built student accommodation towers and a third build-to-sell apartment tower above a shared commercial podium and basement.

Across the three towers, SP Setia is proposing 606 build-to-sell apartments and 1,499 student accommodation units containing 2,009 beds.

The apartments will sit in the tallest tower, which will rise nearly 200m and 55 storeys. It will become&nbsp;one of the more substantial new build-to-sell apartment projects at the northern edge of Melbourne's CBD.

The apartment mix is weighted toward smaller inner-city product, with 188 studios, 206 one-bedroom apartments, 192 two-bedroom apartments and 20 three-bedroom apartments

<img alt="First look: SP Setia plans three-tower finale for Carlton’s former CUB precinct" data-entity-type="file" data-entity-uuid="8271bc87-1b0a-41b7-ac73-a425ee375261" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/3_2.png?VersionId=G4lw23o90B1boX4k4dj7rdz2ZEajS9wy" />

Part of the precinct will be a large-scale&nbsp;3,684 sqm supermarket and a further 2,198 sqm of speciality retail, creating close to 5,900 sqm of new commercial space within the precinct.

But one of the biggest components of the proposal is what sits between the buildings.

Around 4,650 sqm, or roughly 72 per cent of the site, will be publicly accessible open space, incorporating plazas, pedestrian connections, landscaped laneways and retail spill-out areas.

The ground plane is intended to finally complete pedestrian connections envisaged when the CUB masterplan was first approved nearly two decades ago, stitching together Victoria Street, Queensberry Street, Bouverie Street and Swanston Street through the former brewery precinct.

Urbis said the development would "complete the CUB precinct", with the public realm providing important north-south and east-west connections through what is currently the final undeveloped portion of the masterplanned site.

SP Setia is also exploring a new linear park within the Bouverie Street road reserve, with the concept to be developed further with the City of Melbourne through the planning process.

The proposal is being pursued through the Victorian Government's Development Facilitation Program under Clause 53.23 for significant residential development with affordable housing.

The planning report acknowledges the proposed heights exceed those contemplated under the original Comprehensive Development Plan and masterplan, but argues the built-form context has changed considerably over the past two decades.

Urbis said the three towers would instead create a stepped transition between Carlton and the Hoddle Grid, rising progressively from the 94.1-metre Tower One along the Queensberry Street edge to the 199.44-metre Tower Three closer to the established CBD-scale buildings to the south.

<img alt="SP Setia" data-entity-type="file" data-entity-uuid="e885a07a-592c-40fc-bf82-e6dbaf32da54" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.52.24%E2%80%AFAM.png?VersionId=7s_ErUkSKAdY1mAWp3GRZgMNCGtwhk5m" />

SP Setia plans to deliver the development across three stages.

Stage One would deliver the basement, podium and retail areas for the entire precinct alongside the first student tower. Tower Two would follow in Stage Two, before the 606-apartment Tower Three is delivered as the final stage.

If approved and delivered, the project would close out a redevelopment process that has been underway since the former brewery masterplan was approved in 2007, adding more than 2,600 student beds and apartments to a precinct already home to Swanston Central, the Barak Building, RMIT Design Hub and several large student accommodation developments.

&nbsp;

&nbsp;

Joel Robinson

SP Setia plans three-tower finale for Carlton’s former CUB precinct

Melbourne developer Lowe Living is seeking to add to its growing bayside apartment pipeline, filing plans for a boutique eight-residence development in tightly held Middle Park.

Lowe Living, which has built much of its development portfolio across Melbourne's affluent bayside and south-east suburbs, is behind the plans for the 730 sqm site at <a href="https://www.apartments.com.au/new-apartments/123-125-erskine-street-middle-park-vic-3206">123-125 Erskine Street</a>, just off Armstrong Street and within the Armstrong Street Neighbourhood Activity Centre.

The developer is seeking approval for a five-storey residential building above two basement levels, with just eight large-format apartments and 18 car spaces.

“This is a deliberately very different proposition for us,"&nbsp;Tim Lowe, Co-Founder of Lowe Living, said.

"Eight residences is exceptionally boutique, but that's precisely what this site calls for.

“There is a strong community in Middle Park and the surrounding suburbs who have spent decades building a life here. They no longer want the maintenance of a large period home, but they aren't prepared to compromise on space, quality or location. We think there is a real opportunity to capture that hyper local market. A site like this rarely comes to market.”

<img alt="Lowe " data-entity-type="file" data-entity-uuid="875fe572-0f14-4d90-9e11-55b28dd07731" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.42.49%E2%80%AFAM.png?VersionId=GDNQRv9BfpR9r1zkZ5UDyUM4ZvpIksut" />

The low-density proposal has been designed by Cera Stribley and is being progressed through the Victorian Government's Great Design Fast Track pathway, having already secured eligibility from the Minister for Planning.

The Office of the Victorian Government Architect supported its eligibility after finding the proposal demonstrated consistency with the program's seven design principles, while the project's financial feasibility has also been independently confirmed by Invest Victoria.

The project is targeting the downsizer market, with the planning documents describing the homes as larger-format residences and noting the two penthouses could otherwise have been configured as four separate apartments.

<img alt="Lowe 2" data-entity-type="file" data-entity-uuid="60ab0987-2da6-4175-adac-315dcf6053c6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.15%E2%80%AFAM.png?VersionId=bOCPH0B2MFwlmaRW.TTCF9TzyifgVoQI" />

The site has dual frontage to Erskine Street and Canterbury Place and currently comprises a collection of commercial buildings used as offices, including a former heritage bakehouse, a former stable, a later gabled addition and a central courtyard.

It sits within the Commercial 1 Zone and the Armstrong Street Commercial Precinct heritage overlay, with the existing property classified as a contributory heritage place.

Heritage has subsequently played a significant role in Cera Stribley's design.

The front section of the former bakehouse facing Erskine Street will be retained, including its return walls, street-facing hipped roof and chimneys, while the Erskine Street façade and part of the western return wall of the former stable will also be incorporated into the new development.

Levels four and five will be set back five metres from the retained stable façade, while bricks removed through demolition are proposed to be salvaged and reused within the new building where possible.

<img alt="Lowe 3" data-entity-type="file" data-entity-uuid="e97927a9-a2de-4a0f-83b6-65451238abfa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.06%E2%80%AFAM.png?VersionId=VR44AChLrX9q1XPB9GvVQV.ALXXbe4gC" />

Rather than presenting as a single five-storey building to Erskine Street, Cera Stribley has broken the development into a series of distinct forms.

A three-storey infill element will sit between the retained bakehouse and stable façades, with the upper levels recessed behind the heritage fabric. Canterbury Place will similarly feature two three-storey podium forms, separated by a central pedestrian accessway, before the upper two levels step back from the street.

A pedestrian through-link will run through the centre of the project between Erskine Street and Canterbury Place, creating entrances from both sides of the site and introducing landscaping and communal areas through the ground plane.

Landscape architect Acre has designed planting across the ground level, private terraces and upper levels, including a feature canopy tree at level three and integrated planting and arbours across the level four terraces. Five existing Erskine Street trees are proposed to be retained.

Sustainability is also a significant component of the Great Design Fast Track application. The apartments are targeting an average eight-star NatHERS rating, with no residence below 6.5 stars, while the project has achieved a 75 per cent BESS score. Seven of the eight apartments are designed for cross-ventilation, with the remaining residence using mechanically assisted natural ventilation.

The plans also incorporate an 8kWp rooftop solar system, a 5,000-litre rainwater tank and infrastructure allowing future electric vehicle charging for every residence.

Lowe has a strong portfolio across Melbourne's blue-chip suburbs. They recently launched <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House by Lowe Living</a> in Camberwell, their first development in the Stonnington LGA.

Lowe Living unveils Middle Park apartment development

Article summary

<ul data-end="888" data-start="289">
	<li data-end="442" data-section-id="8tsh6o" data-start="289">DVB Projects is preparing to launch its second Gold Coast apartment development, with demolition now underway at 137 Old Burleigh Road, Broadbeach.</li>
	<li data-end="573" data-section-id="1nyxl3e" data-start="443">The 34-level tower will comprise just 49 ultra-luxury residences, including half-floor, full-floor and penthouse apartments.</li>
	<li data-end="717" data-section-id="oiyimj" data-start="574">The launch follows strong demand at DVB's nearby Sea Glass project, which is more than 50 per cent sold and currently under construction.</li>
	<li data-end="888" data-section-id="epk9o9" data-start="718">The development adds to the transformation of Old Burleigh Road, with premium beachfront apartment projects continuing to reshape the tightly held Broadbeach strip.</li>
</ul>

<a href="https://www.apartments.com.au/developers/dvb-projects">DVB Projects</a> is preparing to launch its second Gold Coast apartment development, with demolition now underway on the Broadbeach site as the Sydney developer moves closer to bringing the ultra-luxury project to market.

The 34-level tower at <a href="https://www.apartments.com.au/new-apartments/137-old-burleigh-road-broadbeach-qld-4218">137 Old Burleigh Road</a> will comprise just 49 residences, ranging from half-floor apartments through to full-floor homes and a penthouse. The launch follows the strong sales performance of DVB's nearby Sea Glass development. More than half of the apartments at Sea Glass, on the other side of Broadbeach, have been snapped up, well ahead of its late 2027 completion

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="2944b4be-c84e-4b54-8dc1-c712e76704c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E02_Exterior_Street%20Level%20Entrance.jpg?VersionId=YoNig7pRdrE3HCue7sUj78LzJteeQf3H" />

The start of demolition at 137 Old Burleigh Road signals DVB Projects’ underlying confidence in the Gold Coast’s luxury beachside apartment sector.

“We see the Gold Coast as one of the most compelling lifestyle markets in Australia, particularly at the premium end where demand continues to deepen,” said Dean Brown, Managing Director of DVB.&nbsp;

“This project has been carefully designed to respond to that demand - delivering large-format residences with a level of quality, privacy and amenity that is still relatively rare in the apartment market on the beachside."

Brown says the site itself is "exceptional."

"Old Burleigh Road is one of the most tightly held beachfront strips, and opportunities to deliver a project of this scale and calibre in this location are extremely limited.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="398f377a-c037-455e-9250-0c5e0d84c35b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/I12_FF%20Balcony.jpg?VersionId=NwOiRWGMubR1c8wthuEfggklcja7al9." />

The project will comprise 40 half-floor residences of approximately 260 sqm, alongside eight full-floor residences spanning around 524 sqm.

A single penthouse will crown the building, featuring a private pool, barbecue area, indoor gym and dedicated entertaining spaces.

Residents will have access to a resort-style suite of amenities, including a 20-metre pool with daybeds, a gymnasium, hot and cold plunge pools, a sauna, and private residents’ lounge and dining facilities.

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="d1642bb0-9a66-4427-a022-dfc0988c6287" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/A02_Pool%20to%20View.jpg?VersionId=c0IXPyn_Gp_Kn3XCwzMrqIVkAdCEwVXP" />

Sales agent Todd Matheson, of <a href="https://www.apartments.com.au/project-marketer/pezet-matheson">Pezet Matheson</a>, which is marketing both 137 Old Burleigh Road and Sea Glass, said 137 Old Burleigh Road would address a clear gap in the market for genuine luxury products.

“There are very few opportunities on the Gold Coast where buyers can secure a residence of this size and quality in a new building,” Matheson said.

“What we’re seeing is a growing cohort of downsizers and interstate buyers who still want space - they’re not willing to compromise on living area, entertaining or finishes.

“This project has been designed with that buyer in mind. It offers the scale of a home, combined with the convenience and security of apartment living, in one of the coast’s most desirable positions.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="59aae0ca-5639-4320-8aca-d0bf60f48e43" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E01_Exterior%20Hero.jpg?VersionId=DS8Zfy2WtgUEtdfe0TEUuf1W1GfcZq8S" />

Located on a 1,156 sqm site one block from the beachfront, the development will replace an ageing walk-up building and is expected to contribute to the ongoing transformation of the Old Burleigh Road strip into one of the Gold Coast’s most prestigious residential corridors.

With the development moving into the delivery phase, 137 Old Burleigh Road is slated to hit the market later this year.

[smartcode_project_cta:default project_id=145141]

DVB Projects to launch second Broadbeach apartment tower as demolition commences

<a data-end="327" data-is-only-node="" data-start="250" href="https://www.apartments.com.au/developers/norus-projects" rel="noopener" target="_new">Norus Developments</a> has lodged plans for a new apartment development in Clayton that would add further momentum to the suburb's emerging Green Street corridor.

Plans have been lodged for the consolidated site at <a href="https://www.apartments.com.au/new-apartments/1359-1365-centre-road-clayton-vic-3168">1359-1365 Centre Road</a>, where Norus is seeking approval for 218 apartments across a 12-storey apartment building designed by <a href="https://www.apartments.com.au/architects/life-architecture-and-urban-design">Life Architecture</a>.

The proposal sits within the Clayton Major Activity Centre at the threshold of the planned Green Street corridor, a landscaped pedestrian connection intended to improve links through the precinct towards Clayton Railway Station.

The development would replace the site's existing collection of low-scale residential and commercial buildings with a single consolidated building, introducing significantly greater housing density to this part of Centre Road.

A retail tenancy is proposed at ground level to activate the Centre Road frontage, accompanied by transparent street interfaces and landscaping intended to create a more pedestrian-focused edge to the development.

<img alt="First look: Norus Developments plans landscape-led apartment project for Clayton’s emerging Green Street" data-entity-type="file" data-entity-uuid="0a5a763a-d9e9-4253-af2f-88008de27ebf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Clayton%20a.png?VersionId=S2WJJbat1XVkZwB9SnYtygirXgWHiklX" />

The building has been designed with stepped massing and upper-level setbacks to manage its transition towards surrounding residential properties. The planning report describes the approach as one that integrates the building into the landscape rather than treating landscaping as a secondary element.

"A strong landscape and public realm strategy underpins the proposal," Urbis states in the planning report.

"Public benefits include an affordable housing contribution, a new pocket park, generous landscaped setbacks, deep soil planting and integrated Water Sensitive Urban Design."

The report adds that these elements are intended to create "a permeable, pedestrian-focused ground plane that enhances walkability, supports urban cooling and reinforces the emerging Green Street character."

Biophilic and passive design principles extend through the residential levels, with planting, daylight, natural ventilation and views towards landscaped areas forming part of the amenity strategy.

Parking would be concentrated away from the public realm, with 145 car spaces proposed from the rear laneway rather than dominating the Centre Road frontage.

The proposal follows an extensive pre-application process with the City of Monash. Three formal meetings were held between the project team and Council from December 2025 to March 2026, with the scheme evolving through several concept iterations before the current design was lodged.

The project arrives as Clayton prepares for substantial change around its established activity centre and the wider Suburban Rail Loop precinct. Its position on Centre Road places the development within an existing concentration of shops, services and public transport, while the Green Street connection is intended to strengthen pedestrian access towards Clayton Railway Station.

First look: Norus plans landscape-led apartment project for Clayton’s emerging Green Street

<a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a> has officially commenced construction on Bronze on Chevron, celebrating the sod turning of its first-ever Gold Coast development and marking a significant milestone in the company's continued expansion across South East Queensland.&nbsp;

Following the successful delivery of premium residential developments throughout Brisbane and the Sunshine Coast, <a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-chevron-island-qld-4217">Bronze on Chevron</a> represents Gardner Vaughan Group's entry into the Gold Coast market. Bronze will deliver 119 one, two, three and four-bedroom apartments above two ground-level retail tenancies.

[smartcode_project:default project_id=107520 project_image_fid=367193]

The recent sod turning ceremony was attended by Deputy Mayor Mark Hammel, President of the Surfers Paradise Surf Life Saving Club, Cassandra Sedgman, project consultants, purchasers, project partners and invited guests to celebrate the commencement of construction.&nbsp;

Gardner Vaughan Group Chief Executive Officer Simon Betteridge said Bronze on Chevron represented an exciting new chapter for the business.&nbsp;

"We've spent almost four decades building homes that respond to the way people want to live, and we're excited to bring that experience to <a href="https://www.apartments.com.au/developments/chevron-island-qld-4217">Chevron Island</a>," Betteridge said.

"Bronze on Chevron is particularly significant because it marks Gardner Vaughan Group's first development on the Gold Coast following many successful projects across Brisbane and the Sunshine Coast."

[smartcode_project:default project_id=107520 project_image_fid=367183]

Betteridge said the ground breaking is a proud moment for the&nbsp;team and their purchasers, who can now see their future homes beginning to take shape.&nbsp;

"As both developer and builder, we're able to oversee every aspect of the project from design through to construction, ensuring the quality and attention to detail Gardner Vaughan Group has become renowned for."&nbsp;

Designed by acclaimed architectural practice <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, Bronze on Chevron has been thoughtfully designed to complement Chevron Island's evolving streetscape while embracing its relaxed coastal lifestyle.

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029.&nbsp;

[smartcode_project_cta:default project_id=107520]

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029

Gardner Vaughan Group breaks ground on first Gold Coast development, Bronze on Chevron

National Australia Bank (NAB) has brought forward the timing of the first RBA cash rate cut by three months.

NAB is now expecting a cut in February, in line with ANZ and Westpac, having initially thought a cut wouldn't come until May.

Commonwealth Bank, the nation's largest lender, still thinks the first cut will come in December.

NAB changed its call following the August monthly inflation figures that were released at the end of September, showing it had dropped to 2.7 per cent.

"The risk has been skewed to a first cut earlier in 2025, and today’s change acknowledges the balance of risks has likely shifted sufficiently for the RBA to feel comfortable cutting a little sooner than we earlier expected," NAB noted in its latest update.

They added that the cadence of the cuts may be faster than its central profile.

"Domestic inflation pressures are cooling, but only gradually, and we continue to expect the conditions for a cut will not be in place this year.

NAB believes the easing cycle will end at 3.1 per cent by early 2026, which is five cuts from the current 4.35 per cent cash rate.&nbsp;

CBA also thinks 3.1 per cent will mark the end of the cutting cycle, while Westpac is forecasting 3.35 per cent, and ANZ is the most pessimistic at 3.6 per cent, which would be just three interest rate cuts.

<h2>What would a rate cut in February look like for borrowers?</h2>

According to&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://link.mediaoutreach.meltwater.com/ls/click?upn%3Du001.IVvjJ-2BPT0A8C3VxtqKc6e3bj5hBuw27WFEYqovsYs7kPsgFulYrdOzeP8gI7CybJOya3_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20hPXdLlPP9yD7DvFFDBM5yrTqxvcCiMfAsW1onD-2FcriL628eYdhNQE7bwzYrxcOYnmaYfRhGl-2FEHQ6eK2uQcLxs6Cbu6Dx0bYvpi5A6enmxMWU5TkcRYrP6Z8GbXZYtc5qSoKu6eWFBQR9K7fsjXwHMmby3D3X6Yx-2BxcDcdRruTG&amp;source=gmail&amp;ust=1727774368149000&amp;usg=AOvVaw2vK2ujS77CHs9VRvSSXzLC" href="https://link.mediaoutreach.meltwater.com/ls/click?upn=u001.IVvjJ-2BPT0A8C3VxtqKc6e3bj5hBuw27WFEYqovsYs7kPsgFulYrdOzeP8gI7CybJOya3_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20hPXdLlPP9yD7DvFFDBM5yrTqxvcCiMfAsW1onD-2FcriL628eYdhNQE7bwzYrxcOYnmaYfRhGl-2FEHQ6eK2uQcLxs6Cbu6Dx0bYvpi5A6enmxMWU5TkcRYrP6Z8GbXZYtc5qSoKu6eWFBQR9K7fsjXwHMmby3D3X6Yx-2BxcDcdRruTG" target="_blank">Canstar</a>, if there is a cut in February, a borrower with a $600,000 loan today and 25 years remaining would see their monthly repayments drop by $92.&nbsp;

<table border="1" cellpadding="0" cellspacing="0">
	<tbody>
		<tr>
			<td colspan="3">
			Impact of 0.25% pt cut in February 2025
			</td>
		</tr>
		<tr>
			<td>
			Current loan size
			</td>
			<td>
			Drop in monthly repayment
			</td>
			<td>
			New monthly repayment
			</td>
		</tr>
		<tr>
			<td>
			$600,000
			</td>
			<td>
			-$92
			</td>
			<td>
			$3,907
			</td>
		</tr>
		<tr>
			<td>
			$750,000
			</td>
			<td>
			-$114
			</td>
			<td>
			$4,884
			</td>
		</tr>
		<tr>
			<td>
			$1M
			</td>
			<td>
			-$153
			</td>
			<td>
			$6,512
			</td>
		</tr>
		<tr>
			<td colspan="3">
			Source:&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://link.mediaoutreach.meltwater.com/ls/click?upn%3Du001.xWMOP9hChsvn-2BC9O-2FebBihXIZ4cEzbiuENdxm-2Bx3-2FYEEgYMhZlKWNj5Zzy1YZ56RuASD_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20v2akwr6-2BqLyRrlEgkJ4J-2BCCyY0x189xEHZA4Ylf8c7ChBqNIkhmftZzoFuZKFn43pw3oJVg2o1gumrpdA-2B7MB-2FBtmL2rFCI-2FXORATQHySCLVOMg7Vywv-2BqnnQUAtDz6XkvpwxdHFXh70VwKazzhJsICilEYOvP4ju0sIfi5g6TL&amp;source=gmail&amp;ust=1727774368149000&amp;usg=AOvVaw2qVnp6oqATgqDUi2Frm22q" href="https://link.mediaoutreach.meltwater.com/ls/click?upn=u001.xWMOP9hChsvn-2BC9O-2FebBihXIZ4cEzbiuENdxm-2Bx3-2FYEEgYMhZlKWNj5Zzy1YZ56RuASD_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20v2akwr6-2BqLyRrlEgkJ4J-2BCCyY0x189xEHZA4Ylf8c7ChBqNIkhmftZzoFuZKFn43pw3oJVg2o1gumrpdA-2B7MB-2FBtmL2rFCI-2FXORATQHySCLVOMg7Vywv-2BqnnQUAtDz6XkvpwxdHFXh70VwKazzhJsICilEYOvP4ju0sIfi5g6TL" target="_blank">www.canstar.com.au</a>. Starting rate is the RBA existing average owner-occupier variable rate of 6.36%. Assumes banks pass the cash rate cut on in full the month after the meeting.
			</td>
		</tr>
	</tbody>
</table>

Canstar Data Insights Director, Sally Tindall, says if core inflation continues to track in the right direction, or unemployment starts to accelerate significantly, we could well see a cash rate cut as early as February of next year.

“All four big banks now believe the RBA will be ready to cut the cash rate in just over four months’ time, if not before, in the case of CBA.

“However, the outlook for both inflation and unemployment is still highly uncertain. A couple of wobbly sets of inflation data could see the RBA holding for longer, particularly if unemployment remains relatively steady."

&nbsp;

Commonwealth Bank, the nation's largest lender, still thinks the first cut will come in December.

NAB bring forward first RBA cut to February 2025

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The RBA has cut the cash rate by 25 basis points to 3.25% – the lowest the cash rate has been in three years – but borrowers are unlikely to receive the full benefit of the reduction.
A 25-basis-point rate cut would reduce monthly mortgage repayments on a $300,000 variable rate mortgage by around $50 a month.
Passing on 20 out 25 of the basis points on offer, as the Bank of Queensland announced within two minutes of the 2.30pm RBA announcement, equates to only a few dollars fewer a month, although the banks will face a public backlash if they don’t pass on the full rate cut.
Media attention will focus on the deep pockets of the banks and their recent multibillion-dollar profit announcements in the recent reporting season.
The banks will argue that they have to balance the need of shareholders against those of customers and that aspects of their funding mix remain expensive, including funding from household deposits.
The Reserve Bank indicated today the banks are well positioned to secure additional funding.
“Well-rated banks, and Australian banks have had no difficulty accessing funding, including on an unsecured basis,” said RBA governor Glenn Stevens in the monetary policy decision statement.
It followed comments in the bank's September Financial Stability Review, which noted that “the Australian banking system has remained in a relatively strong position”.
“Pressures in wholesale funding markets have eased since late last year, allowing the large banks to maintain good access to international bond markets during the past six months,” the RBA said.
However, the RBA also noted that banks have reduced their dependence on wholesale funding with a greater reliance on retail deposits to fund mortgage lending.
In his latest banking report, Nomura analyst Victor German said household deposit growth remained strong in August among the major banks, a positive for their overall funding profile, but warned that Nomura’s latest survey of deposit spreads “highlighted that competition for deposits continued to be intense”.
The Australian Bankers’ Association explained in August that banks source their funds from equity investors, depositors and from the short and long-term wholesale markets.
“Deposits and long-term wholesale are the two sources of funds which are now structurally more expensive than they were pre-crisis. Short-term funding and equity are almost back to pre-crisis prices,” it said.
“Banks need to maintain an adequate level of profitability to maintain solid credit ratings which bear directly on the price and availability of funding. Sustainable profitability also provides broader benefits to the community, including employment, salaries and wages, and downstream benefits to partners and suppliers,” said Steven Münchenberg, CEO of the ABA.
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Cash rate cut, but borrowers unlikely to enjoy the full benefit

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The move by the Reserve Bank of Australia to cut the cash rate by 25 basis points today is positive news for the real estate industry and combined with other official interest rate drops this year, will have a beneficial impact on the sector.
The collective 75-basis-point drop in the cash rate over May and June has gone some way to improving confidence in the housing sector, but the latest rate cut was necessary in order for the real estate industry to see a sustained improvement in conditions.
This year’s rate cuts have contributed to a significant improvement in housing affordability and allowed households additional capacity to repair their balance sheets, and today’s 25-basis-point cut will only help the situation further.
These drops have gone some way to improving confidence amongst consumers, who have been exercising caution particularly due to the financial situation in the eurozone.
But while this week's 0.25-percentage-point drop in the cash rate is welcome news, more cuts are needed this year.
Last month it appeared likely that the RBA would need to reduce rates by another 25 to 50 basis points before the year’s end, the reasoning being that a pre-emptive measure would kill off evidence of a slowing economy.
Over the last month the softness has continued and the bank has found reasons to adjust its settings, dropping the cash rate by 25 percentage points. But the question now becomes ‘Is that enough?’ And from a property perspective it is not.
More cuts to the cash rate are needed, with the justification being the softness of the inflation figures, and more importantly, the easing in the jobs market.
Inflation remains low rising only 1.2% during the 12 months to June 2012, compared with a rise of 1.6% through the year to March 2012. Underlying inflation is also limited increasing by 0.6% during the second quarter of 2012, taking the annual increase to 1.9%.
Such low results are reflective of a national economy that is entering a slowing phase.
 
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Meanwhile, the most important market for the property sector – the jobs market – is showing clearer signs of weakening. Although the latest labour market trend data shows the unemployment rate remains at the healthy level of 5.2%, where it has settled over the past four months, monthly full-time jobs growth has disappeared.
Data for full-time jobs, which is the key driver of the residential property market, shows there was a contraction (600) in the number of positions nationwide in August. This follows a previous contraction (500) in July.
Over the 12 months to August 2012, full-time employment actually increased by 27,900 jobs, and while this is the largest increase over a 12-month period since October 2011, it is far below trend.
Further evidence of an easing in labour demand has been provided by recent trends in job advertising. The ANZ Job Advertisement Series showed that number of job advertisements fell 2.3% in August after falling 0.8% in July. This represents the fifth consecutive monthly fall.
Of particular interest has been the weakening trend in Queensland, Western Australia and the Northern Territory, which have been the regions benefiting most from the mining boom. Job advertising has now been weakening for around six months in each of these states and territories.
Looking ahead to the RBA’s Melbourne Cup Day meeting, ABS Retail Trade and Building Approvals data – due for release on Thursday – will provide some further clues as to whether the bank will cut the cash rate further.
It is the labour force data that is likely to remain in focus, however. One more month of retreating full-time jobs numbers should be enough to tip the scale in favour of another Melbourne Cup Day cut.
And what a beautiful Melbourne Cup quinella it would be for the national property market if the RBA firstly announced the drop in rates and secondly, if the banks passed on the full impact.
Mark Courtney is research director at <a target="_blank" href="https://www.colliers.com.au/">Colliers International.</a>
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mcourtney-5DU2hjjTSG

Another rate cut – with the banks passing on in full – would make a beautiful Melbourne Cup quinella

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The housing industry has welcomed the RBA cutting the cash rate by 25 basis points today to 3.25% and expects a follow-up rate cut when the bank next meets on Melbourne Cup Day on November 6.
The rate cut came despite capital city <a target="_blank" href="https://www.propertyobserver.com.au/residential/surprise-14-rise-in-capital-city-dwelling-values-highest-in-30-months-but-moderate-growth-ahead-rp-data-rismark/2012100256920">dwelling prices surging 1.4% in September</a>, according to RP Data-Rismark.
Praise for the rate cut came from the Housing Industry Association (HIA), which represents the struggling residential building sector.
The HIA says the rate cut was appropriate “given current economic conditions, which are highlighted by the parlous state of the residential construction industry”.
HIA chief economist Dr Harley Dale called on lenders to “deliver today's interest rate cut in full, without delay, to provide the appropriate relief to businesses and mortgage holders".
"There is no funding cost wall to justifiably hide behind," says Dale, who adds that there is also a need for a follow-up interest rate cut on Melbourne Cup Day, with “widespread expectation for that outcome”.
The HIA prepared the following chart, which show that while margins banks earn on mortgage lending fell in August (the grey bars), they still remain at historical highs.
Click to enlarge
<a href="/images/stories/2012/09/hiaoct2.gif" rel="shadowbox" title="Click to enlarge"><img src="/images/stories/2012/09/hiaoct2thumb.gif"></a>
Real Estate Institute of Australia (REIA) president Pamela Bennett said today’s decision “is a great relief for home owners and potential buyers”.
“Home owners always like to see interest rates go down.  This cut means the average loan repayment is reduced from $2,155 to $2,105 or by $50 per month.”
Mark Courtney, Colliers International research director, says the collective 75-basis-point drop in the cash rate over May and June has gone some way to improving confidence in the housing sector, but the latest rate cut was necessary in order for the real estate industry to see a sustained improvement in conditions.
“This year’s rate cuts have contributed to a significant improvement in housing affordability and allowed households additional capacity to repair their balance sheets, and today’s 25 basis point cut will only help the situation further,” he says.
“These drops have gone some way to improving confidence amongst consumers, who have been exercising caution particularly due to the financial situation in the eurozone.”
But he said more cuts were needed this year because from a "property perspective" one rate cut was not enough.
 
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Economists were more circumspect in their responses.
CommSec chief economist Craig James says the RBA “acted to insulate the Australian economy from weakness abroad”.
But he says that while rate cuts have in the past acted to stimulate activity, "the impact on the economy today is more ambiguous".
“While rate cuts help borrowers, they hurt savers," says James.
“The number of savers has soared and currently deposits are creeping up to be almost neck and neck with loans. Deposits represent around 90% of loans outstanding, well up from 75% just five years ago.
“Further only a third of households benefit from a rate cut with a third of families renting while a third of families fully own their homes. The non-home buying public tend to be savers rather than borrowers. So a rate cut will hurt all the families living off interest income.”
James says confidence remains the pertinent question.
“If people don’t have the confidence to spend and instead continue to save and pay off home loans at a faster rate, then the rate cut will have no impact on activity.
“It is also important to note that it is the level of interest rates that does the hard lifting work in the economy, not the change in rates. Interest rates are already below longer-term averages. And judging by what has happened in previous months, home borrowers are more likely to respond to a rate cut by paying off their home loan at a faster rate, rather than going on a spending spree.”
Rismark economist and Australian Financial Review columnist Christopher Joye tweeted that home variable home loan rates would “fall to around 5.4% and 5.5% (near GFC lows); 3yr fixed rates as low as 5.3%”.
“Near GFC lows in home loan rates will galvanize recovery in house prices - great news for home owners,” he added in a follow-up tweet.
Australian Property Monitors senior economist Dr Andrew Wilson called the rate cut good news for home buyers and housing affordability but questioned in a tweet that it “seemed a speculative move as economic drivers have improved recently”.
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Housing industry welcomes RBA cash rate cut and expects another on Melbourne Cup Day 

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The Reserve Bank’s decision to cut the official cash rate by a further 25 basis points is welcome news, but the housing market remains in need of a more coordinated approach to reach a full recovery.
As ever, the willingness of the banks to take a fair and reasonable course of action and pass the rate cut on in full is crucial to the impact of the RBA’s decision.
Recent cuts to the official cash rate have not had the desired impact, and while activity has picked up with the commencement of the spring selling period, there is substantial improvement still to be realised for the sector to be deemed healthy again.
Government obviously recognises the important role the housing market plays in an economic context, evidenced by the slate of property-related taxes it relies upon.
It therefore seems reasonable that a more coordinated approach between all levels of government and the residential sector should be pursued to improve the health of the sector.
A reconsideration of stamp duty is the most obvious place to start.
Considerable evidence already exists to support the idea that government stands to gain substantially increased revenue associated with increased transactional levels should stamp duty be abolished.
To suggest this tax is too important a source of revenue is erroneous and obsolete.
Another area requiring a commitment from government is an improvement to the planning and development approval process.
For too long incentive programs have been focused on the buyer side of the equation. Perhaps a more serious focus on addressing developer concerns, such as levies and the speed of the approval process, would enable the RBA’S interest rate cuts to have a more measurable and significant impact.
Leanne Pilkington is general manager of<a title="Laing + Simmons" href="https://www.laingsimmons.com.au/" target="_blank"> Laing + Simmons</a>
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Passing the rate cut on in full is crucial

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Rate cuts take time to filter through the economy, but our research shows the property market responds quickly.
This rate cut will lead to cheaper loans and add momentum to the housing market in the coming months.
It could also fuel construction, leading to property-related jobs and an uptick in tax revenue for the government.
In the marketplace we have seen house prices rising on average since the last RBA rate cut in June, so vendors have been buoyed heading into spring selling season and will continue to be.
The LJ Hooker network of mortgage brokers see the rate cuts in their lead sheets.
Each time the Reserve Bank of Australia lowers the cash rate there is a noticeable increase in inquiries from those looking to purchase property.
Borrowing rates to buy a home were historically low even before this rate cut.
Market rates for three-year fixed-rate mortgages are 113 basis points below the average since 2000.
This will encourage more Australians to buy property, whether a primary home or an investment, in the coming year.
Interested buyers are still adjusting to the last RBA rate cut in June.
This new cut will further encourage them to enter the market.
L. Janusz Hooker is deputy chairman of <a href="https://www.ljhooker.com.au/" target="_blank">LJ Hooker</a> deputy chairman
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ljanusz-qWn5X4b38e

Rate cuts take time to filter through

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RBA governor Glenn Stevens has released a statement regarding today's RBA board meeting decision. 
<h3 id="mr-title">Statement by Glenn Stevens, governor: Monetary Policy Decision</h3>
"At its meeting today, the board decided to lower the cash rate by 25 basis points to 3.25%, effective 3 October 2012.," Stevens said.
"The outlook for growth in the world economy has softened over recent months, with estimates for global GDP being edged down, and risks to the outlook still seen to be on the downside. Economic activity in Europe is contracting, while growth in the United States remains modest. Growth in China has also slowed, and uncertainty about near-term prospects is greater than it was some months ago. Around Asia generally, growth is being dampened by the more moderate Chinese expansion and the weakness in Europe.
"Key commodity prices for Australia remain significantly lower than earlier in the year, even though some have regained some ground in recent weeks. The terms of trade have declined by over 10 per cent since the peak last year and will probably decline further, though they are likely to remain historically high.
"Financial markets have responded positively over the past few months to signs of progress in addressing Europe's financial problems, but expectations for further progress remain high. Low appetite for risk has seen long-term interest rates faced by highly rated sovereigns, including Australia, remain at exceptionally low levels. Nonetheless, capital markets remain open to corporations and well-rated banks, and Australian banks have had no difficulty accessing funding, including on an unsecured basis. Share markets have generally risen over recent months," Stevens said.
"In Australia, most indicators available for this meeting suggest that growth has been running close to trend, led by very large increases in capital spending in the resources sector. Consumption growth was quite firm in the first half of 2012, though some of that strength was temporary. Investment in dwellings has remained subdued, though there have been some tentative signs of improvement, while non-residential building investment has also remained weak. Looking ahead, the peak in resource investment is likely to occur next year, and may be at a lower level than earlier expected. As this peak approaches it will be important that the forecast strengthening in some other components of demand starts to occur.
"Labour market data have shown moderate employment growth and the rate of unemployment has thus far remained low. The bank's assessment, though, is that the labour market has generally softened somewhat in recent months.
"Inflation has been low, with underlying measures near 2 per cent over the year to June, and headline CPI inflation lower than that. The introduction of the carbon price is affecting consumer prices in the current quarter, and this will continue over the next couple of quarters. Moderate labour market conditions should work to contain pressure on labour costs in sectors other than those directly affected by the current strength in resources. This and some continuing improvement in productivity performance will be needed to keep inflation low as the effects of the earlier exchange rate appreciation wane. The Bank's assessment remains, at this point, that inflation will be consistent with the target over the next one to two years.
"Interest rates for borrowers have for some months been a little below their medium-term averages. There are tentative signs of this starting to have some of the expected effects, though the impact of monetary policy changes takes some time to work through the economy. However, credit growth has softened of late and the exchange rate has remained higher than might have been expected, given the observed decline in export prices and the weaker global outlook," Stevens said.
"At today's meeting, the board judged that, on the back of international developments, the growth outlook for next year looked a little weaker, while inflation was expected to be consistent with the target. The board therefore decided that it was appropriate for the stance of monetary policy to be a little more accommodative."
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Investment in dwellings has remained subdued: RBA governor's statement for October board meeting

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The self-appointed "shadow" RBA board favours the Reserve Bank leaving the cash rate on hold today at 3.5% but expects a rate cut in the medium term.
The board is comprised of economists and academics that meet under the banner of the Centre for Applied Macroeconomic Analysis (CAMA) at Australia National University.
Keeping the interest rate unchanged at 3.5% received nearly 60% weight, considerably above the next most popular setting — a decrease to 3.25% — which received a 30% weight.
For the RBA's September decision, keeping the interest rate unchanged at 3.5% received around a 65% weight from the shadow board.
In October, the shadow board saw evidence of weakening inflationary pressures and a risk that the current cash rate should be lower.
"The corresponding figures for September suggested both more upside risk and less downside risk to inflation. With some evidence that inflationary pressures will continue to abate in the coming months, there is greater scope for lower rates in the medium term. Support for a decrease in the cash rate over the next six months was just over 50%.
“Support for a decrease in the cash rate over the next six months was just over 50%," said the shadow board.
Shadow board member Saul Eslake, chief economist at Bank of America Merrill Lynch Australia and formerly chief economist at ANZ for 14 years, says the argument for a rate cut is “getting stronger — given the ongoing slowdown in China, and the impact that’s having on commodity prices — but not, so far, on the Australian dollar”.
“However, it’s not yet clear to me that, overall, the negative effects of persistent Australian dollar strength have started to overwhelm the other factors that have kept the unemployment rate steady in a 5% to 5.25% range and growth close to or even slightly above its trend pace so far this year. I expect rates eventually will need to fall, but I’m not ‘over the line’ for October.”


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Another shadow board member, Jeffrey Sheen, professor and head of economics at Macquarie University, says that Australian foreign interest rate differentials are “probably appropriate to this stage of the mining boom, delivering expected future depreciation”
“The expected weakening in the terms of trade — down a little from a 50-year high — will assist this depreciation in due course.”
He also pointed out that there have been no significant changes to global macro risks in the last month.
Shadow board member Paul Bloxham, chief economist at HSBC Bank Australia, says he favours holding rates steady this month, although he says he would be willing to consider cutting rates by 25 basis points.
“Conditions locally and in China look fairly similar to last month. Western growth is still slowing, but it is not clear how much further downward pressure that will put on growth in Asia. Commodity markets have generally stabilised. The local unemployment rate remains low.”
“While there are some signs that employment is easing, timely indicators do not decisively point to weaker conditions. Monetary policy is starting to lift the housing market. Inflation was low in the second quarter, but there is no new price data this month to confirm that this has continued to be the case in the third quarter.
“Given limited urgency to cut rates further, and signs that lower rates are providing some support for the economy, I would prefer to wait for the third quarter CPI for confirmation that inflation remains low before cutting rates further if needed,” said Bloxham
The full shadow board is:
Shaun Vahey, Professor, RSE, ANU. (non-voting chair)
Paul Bloxham, Chief Economist (Australia &amp; New Zealand), HSBC Bank Australia Ltd
Mark Crosby, Dean of the Global MBA Program, Acting Dean of the Global BBA Program, and Professor of Economics, S P Jain Center of Management in Singapore
Mardi Dungey, Professor, University of Tasmania, CFAP University of Cambridge, CAMA
Saul Eslake, Chief Economist, Bank of America Merrill Lynch Australia
Bob Gregory, Professor Emeritus, RSE, ANU, Professorial Fellow, Centre for Strategic Economic Studies, Victoria University, Adjunct Professor, School of Economics &amp; Finance, Queensland University of Technology
Warwick McKibbin, Professor, RSE, ANU, CAMA
James Morley, Professor, University of New South Wales, CAMA
Jeffrey Sheen, Professor &amp; Head, Department of Economics, Macquarie University,Editor, The Economic Record, CAMA
Mark Thirlwell, Director, International Economy Program, Lowy Institute for International Policy
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RBA should keep cash rate on hold at 3.5%: Shadow board

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Across the Tasman, ANZ operates two brands: ANZ, and The National Bank. The National Bank’s black and green branding is on licence from British bank Lloyds. That licence is due to expire in 2014, and ANZ is taking the opportunity to reunite the two brands, which for the past decade have operated separately.
ANZ will spend just under $80 million merging the brands, adopting the National Bank’s back-end systems and most of its products.
The move starkly contrasts with that of rival bank Westpac. Under the ‘multi-brand’ strategy pushed by chief executive Gail Kelly, Westpac operates five high-profile retail-banking brands. Three of these are the result of recent acquisitions. In addition to its red ‘Westpac’ brand, it also owns St George (acquired in 2008) , BankSA (bought by St George in 2002), and RAMS (2007). Westpac also operates the Bank of Melbourne in Victoria, a <a href="https://www.canberratimes.com.au/business/westpac-blast-from-the-past-likely-to-be-a-costly-move-20120424-1xje7">brand it bought in 1997 and rebranded as Westpac in 2004</a> after staff started wearing Westpac uniforms (they wanted to be part of the parent company) and customer surveys showed confusion about the multiple brands. Bank of Melbourne brand was relaunched by Kelly last year.
But the multi-branding strategy hasn’t been embraced by others in the sector. Commonwealth Bank CEO, Ian Narev, recently rubbished the strategy at an investor briefing, saying he had no intention of pursuing a retail banking strategy built around the ''differentiation of a whole lot of different brands.” His comments, together with ANZ’s recent decision to consolidate, show Westpac is swimming against the tide.
Operating multiple brands can help companies tap new customer bases and spread risk, but it comes with its own dangers. Should leading companies learn from Westpac, or are there warning signs in the words and actions of its rivals?
Why companies maintain multiple brands
Companies pursue multiple brands for three key reasons.
The first is to do with risk, explains Dr Simon Bell, a professor marketing at Melbourne University.
“When one brand suffers a reputational hit, having other brands can mean the rest of the products aren’t damaged or affected,” Bell says. “Take the reputational damage to BP with the oil spill. They wouldn’t have suffered as badly across their whole chain if they had multiple brands.”
There’s another way multiple brands reduce risk, according to David Gallop, an executive creative director at marketing agency Huddle Partners.
“You don’t want to put all your money in one place,” he says. “Multiple brands let you spread your bets.
“You’ll always have some brands in decline, others that are growing, and others with potential. If you have an arsenal of different brands, you can manage some down over time.”
The second reason companies turn to different brands is about customers.
When it comes to multi-brand strategies, the masters are fast-moving consumer goods, says Gallop.
“Cosmetics, pharmaceuticals, [vehicle] sales; those sorts of things have succeeded really well with multiple brands.
“It allows them to segment the market across different types of audiences.”
When brands want to extend into new products, sometimes they need a new brand, says Bell. “For example, it’d be impossible to take Coca-Cola into a line of premium watches.”
The third reason isn’t to do with customers, but about internal competition, says Gallop.
“It can keep internal brand managers on their toes, providing that internal competition. They might not be directly competing externally, but if another company’s brand is going really well, that’s pressure to deliver.”
 
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Branding distractions
However, multiple brands come at a cost.
Branding expert Michel Hogan says developing new brands can be a way companies distract themselves from dealing with the difficult parts of brand legacy. Sometimes, what should be considered a product line ends up morphing into a new brand, because building a brand, Hogan says, is fun.
“It’s shiny-object stuff. Coming up with the name, with campaigns, thinking of all the marketing trappings… It’s a lot more fun than the hard grind of making sure all your promises and the like are being met to build your existing brand. I do think a lot of it comes out of distraction and boredom, and isn’t always in the best interests of customers.”
Not to mention, Hogan adds, it’s more expensive than maintaining the one brand.
For this reason, she rarely advises it. “Unless there’s a really good reason – for example, if it’s a completely different customer set, and there are few benefits to leveraging the one brand, or if there’s no benefit from previous brand legacies – I frankly discourage people from it.”
Bell adds another danger of multiple brands: too many priorities can lead to companies neglecting to update their brands over time.
He gives the example of Pacific Brands, which owns classic Australian labels such as Hard Yakka and Bonds.
“I think [new Pacific Brands CEO John Pollaers] has a challenge ahead of him.
“Pacific Brands has suffered over recent years, with a probably reason being that they haven’t invested in their portfolio.” Things like product innovation, as well as marketing and communications, have fallen by the wayside for some of Pacific Brands’ most iconic brands.
The bottom line: Westpac says it’s working
Hogan says Westpac’s situation is unique, because most of its brands came about as a result of its mergers and acquisitions.
“To me that’s a little different than an organisation embarking on a deliberate building of new brand entity that is in direct competition to the core of the rest of the business.
“Their choice is whether to integrate the brands, or build on what they bought: a loyal customer-base, which is perhaps already wedded to a particular brand.”
A 2010 KPMG report outlined some of the <a href="https://www.kpmg.com/CN/en/IssuesAndInsights/ArticlesPublications/documents/Managing-multiple-brands-in-banking-201006.pdf">difficulties banks face</a> maintaining multiple brands in the long-term. As market conditions change for the worse, as they always do from time to time, cost-cutting drives lead to consolidation of back-end systems, and greater sharing of resources between the different brands. Over time, this can lead to a ‘hollowing out’ of the brands, where their unique value proposition isn’t clear.
Sustaining a multiple-brand strategy over time, the report argues, requires explicit targeting of particular customer niches, giving the brands a clear purpose and reason to differentiate themselves from each other. For example, The Royal Bank of Scotland maintains a brand for personal and small business customers, one for high net-worth individuals, and one for insurance services.
Westpac says its multiple-brand strategy has reaped it significant dividends. Kelly <a href="https://www.brisbanetimes.com.au/business/kelly-rejects-multibranding-critics-20120503-1y1qt">recently said</a> it allowed it to target customers that it otherwise wouldn’t be able to.
''There are a range of customers, as we know, that choose St George over Westpac,” she says. “If we didn't have a St George, they wouldn't choose to bank with us.”
Answering her critics, Kelly said she’s bemused by those who say multi-branding is high-cost. “You just can't see that in the numbers.''
But as the KPMG report shows, multi-branding is a long-term haul. Westpac’s experiment has some way to run.
This article first appeard on <a target="_blank" href="https://www.propertyobserver.com.au/https://www.leadingcompany.com.au/strategy/together-but-different-anz-and-westpac-split-on-multiple-brands/201210012623?displaypage=unknown">Leading Company.</a>
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Together, but different: ANZ and Westpac split on multiple brands

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Bank of Queensland has passed on only 20 out of the 25 basis point rate cut announced by the RBA today, an indication that other banks won't pass on the full rate cut.
The 20-basis-point rate cut brings BOQ's standard variable rate home loan to 6.71% p.a. effective from Friday, October 19, 2012.
"Given the continuing pressure on the cost of funding a 20 bps reduction is the best balance between our customers and shareholders,” CEO Stuart Grimshaw says.



“We are also conscious of pressure facing all of our customers, including those with home loans and those with deposits, and believe the 20 bps cut also strikes a fair balance between the two.”
Ken Raiss, director at national accounting, property and wealth advisory group Chan &amp; Naylor, anticipated the issue of whether or not the banks would pass on the full rate cut pre-announcement.
"The rate cut is to stimulate demand and confidence, something which is unlikely to happen unless it is passed on," he says.
“Bank rates need to reflect the true economics of the economy,” says Raiss.
“Banks must align their rates official cash rates and increase availability to loans.”
Meanwhile, Suncorp and NAB have been the standout lenders in terms of funding new mortgages over the past three months to August, according to analysis of the latest APRA banking figures by Nomura.
Queensland-based bank Suncorp has grown its mortgage book by 11.1% between July and August to $32 billion (more than double the <a target="_blank" href="/news">current annualised mortgage growth rate of 4.8%</a>), while NAB has achieved impressive growth of 8.3% off a much larger book, which has grown to $186 billion.
ANZ has pulled back on mortgage lending recording growth of 5.4% over the August quarter – compared with annualised growth of 8.6%.
The Commonwealth Bank and Westpac remain the laggards in terms of new mortgage lending, with growth of just 4.2% each over the August quarter – below system growth of 4.8%.
The Commonwealth Bank’s mortgage book stands at $260 billion.
APRA counts Commonwealth Bank subsidiary Bankwest as a separate entity, with a $48 billion loan book, giving the Commonwealth Bank group a $308 billion combined mortgage book.
Westpac (including its subsidiary banks) has a loan book worth $293 billion.
According to Nomura analyst Victor German, the August APRA figures show that ANZ’s mortgage growth rate continues to converge with the average of the major banks.
However, he says NAB is continuing to gain market share, growing at one-and-a-half times the majors’ growth rate over the past three months.
“We believe this is positive for NAB’s longer-term profitability as long as funding is available.
“Both the Commonwealth Bank and Westpac continue to lose market share in mortgages as they defend their back book profitability,” he says.
NAB’s ability to grow its share of mortgage lending has been funded, in part, by its expanding deposits base.
The total value of deposits held by NAB are up by an impressive 16.5% over the past three months to $235 billion, ahead of the Commonwealth Bank (quarterly growth of 15.6%), Westpac (11.2%) and ANZ (4.7%).
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Banks reluctant to pass on full 25-basis-point rate cut

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The Reserve Bank has surprised the majority of economists by cutting the cash rate by 25 basis points to 3.25% at its October monetary policy meeting today.
This is the lowest the cash rate has been since October 2009.
It is only one 25-basis-point rate cut off the record low of 3%, which was in place from April 2009 to September 2009. This followed the RBA cutting the cash rate by over 400 basis points between August 2008 and April 2009 to keep the economy ticking over in the wake of the GFC.
Only nine economists <a href="/news">polled by Bloomberg</a> last Friday tipped the RBA to cut the cash rate today.
The RBA cut the cash rate despite median property values rebounding by more than 2% in the five capital cities (Sydney, Melbourne, Brisbane + Gold Coast, Perth and Adelaide) quarter-on-quarter in September, according to RP Data-Rismark's daily index.
However, mortgage lending and retail sales have been weak, while concerns remain about the global economy and the Chinese economy in particular.
The major banks and other lenders are expected to announce how much of the rate cut they will pass on to borrowers in the next few days.
ANZ will make its monthly independent interest rate decision on Friday, October 12.
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