Construction is now underway at <a href="https://www.apartments.com.au/new-townhouses/cumulus-grand-villas-carrara-17-baltimore-court-carrara-qld-4211">Cumulus Grand Villas</a> in Carrara, with all stages fully funded as <a href="https://www.apartments.com.au/developers/venturecrowd-property-projects">VentureCrowd</a> progresses its 59-residence gated community on an elevated ridgeline overlooking 100 hectares of natural savanna.

The commencement marks a key milestone for the Gold Coast project, designed by <a href="https://www.apartments.com.au/architects/bda-architecture">BDA Architecture</a> and being delivered by <a href="https://www.apartments.com.au/builders/devcon">Devcon Property Group</a>, at a time when buyers are placing greater emphasis on delivery certainty and builder track record.

With Devcon active in South East Queensland since 1993 and having delivered more than 1,000 homes, the team is positioning Cumulus as a fully financed, under-construction offering in a market where risk mitigation has become a central consideration for off-the-plan purchasers.

[smartcode_project:default project_id=135663 project_image_fid=360496]

Located at 17 Baltimore Court, Cumulus Grand Villas comprises 59 three- and four-bedroom villas across four collections, Skyline, Canopy, Savanna and Broadview. Pricing starts from $1,455,000, with completion of the first stage targeted for Q4 2026.

Across the four collections, each design represents an expansive and thoughtfully considered offering. The Broadview provides additional flexibility within its floorplan, incorporating a multipurpose room or optional additional bedroom, and is priced from $1,895,000.&nbsp;

Configured across two levels, the four-bedroom villas feature two master bedrooms with private ensuites, as well as a multipurpose room (MPR), supporting intergenerational living, guest accommodation, or the creation of a dedicated retreat space.&nbsp;

[smartcode_project:default project_id=135663 project_image_fid=360497]

The main living areas are positioned on the ground floor, while the bedrooms are located upstairs, a configuration that promotes both family separation and connected living. All villas include a second master suite on the ground floor, reinforcing the project’s focus on flexibility and long-term adaptability.

That adaptability was central to BDA Architecture’s design approach. The team sought to create a sophisticated, low-maintenance product that makes the most of the site’s elevation and outlook while responding to evolving household needs. Expansive glazing, open-plan interiors and private outdoor areas draw in natural light and frame views towards the savanna, hinterland and Broadbeach skyline.

[smartcode_project:default project_id=135663 project_image_fid=360470]

VentureCrowd Director of Property David Whitting said the project responds to a growing group of buyers reassessing what premium living on the Gold Coast looks like.

Flexible floorplans have proven particularly relevant for purchasers aged between 40 and 65, including next home buyers, downsizers and investors. The inclusion of dual master suites in the Broadview design, along with options for a downstairs MPR or guest bedroom, allows homes to adapt as family dynamics shift, whether accommodating older parents, adult children, or extended stays.

Across the community, villas are specified with European appliances and premium fixtures and fittings, alongside double garages and landscaped private areas. The gated enclave includes number plate recognition entry, reinforcing a focus on security and exclusivity.

[smartcode_project:default project_id=135663 project_image_fid=360474]

Lifestyle amenity is anchored by the Infinity Terrace, an elevated communal space incorporating a 20m heated pool, alfresco zones and barbecue facilities, designed as a shared retreat within the neighbourhood. A two-acre private nature reserve with walking trails and rehabilitated bushland further integrates the development with its savanna-edge setting, reflecting a broader masterplan initiative to restore native vegetation and habitat corridors.

<a href="https://www.apartments.com.au/developments/carrara-qld-4211">Carrara</a>’s positioning continues to attract attention from prestige buyers seeking proximity to the coast without beachfront pricing. The suburb offers access to major retail centres including Pacific Fair and Robina Town Centre, is around 15 minutes from Broadbeach, and benefits from connectivity via the M1 to Brisbane and the Gold Coast Airport.

[smartcode_project_cta:default project_id=135663]

Joel Robinson

VentureCrowd’s Cumulus Grand Villas in Carrara advances with construction underway

Joint venture partners <a href="https://www.apartments.com.au/developers/abadeen">Abadeen</a> and <a href="https://www.apartments.com.au/developers/perifa">PERIFA</a> are officially launching the third and final residential stage at their landmark $350 million harbourfront precinct, Putney Wharf, with The Residences representing the final opportunity to secure a new home within this rare waterfront destination.

Strong demand has already been established across the earlier stages of <a href="https://www.apartments.com.au/new-apartments/putney-wharf-residences-20-waterview-street-putney-nsw-2112">Putney Wharf</a>, with more than 50 per cent sold ahead of this final release. The Residences will introduce a selection of the precinct’s most premium apartments, many of which were deliberately reserved for this concluding stage.

Located at 20 Waterview Street, <a href="https://www.apartments.com.au/developments/putney-nsw-2112">Putney</a> NSW, the completed precinct will comprise 67 residences, including 18 terraces and 49 apartments, alongside five retail tenancies and a 36-berth marina.

[smartcode_project:default project_id=13962 project_image_fid=1338]

Developed alongside partners Phoenix Property Investors and Mitsubishi Estate Asia, Putney Wharf occupies a prized 300-metre stretch of absolute waterfront and incorporates the historic former Halvorsen’s Boatshed. The precinct connects directly to surrounding parklands via a landscaped foreshore walkway and a large, landscaped podium linking both sides of the development to the adjoining foreshore parklands.

The Residences comprise two newly built, three-storey apartment buildings delivering a boutique collection of 30 generously proportioned waterfront apartments. Designed to capture harbour outlooks, natural light and cooling breezes, The Residences balance architectural refinement with relaxed, low-maintenance living.

Architecturally designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the apartments continue the cohesive design language seen across the broader precinct. A refined palette of light and dark materials, softer-toned stone and neutral, earthy finishes reflect the surrounding landscape and harbour setting. Interiors feature painted timber veneers, tactile joinery, timber flooring to living spaces and 100 per cent natural wool carpets in bedrooms, creating warm and sophisticated homes.

[smartcode_project:default project_id=13962 project_image_fid=362525]

Justin Brown, Executive Chairman and Founder of Abadeen, said the release of the final residential stage marks an important milestone for the project.

“Putney Wharf brings together everything we’ve learned over more than 25 years of development,” Mr Brown said. “It respects the site’s extraordinary maritime history while delivering contemporary homes that connect people directly to the harbour.

The Residences offer the rare combination of low-maintenance apartment living, waterfront outlooks with beautiful sunset views, and the convenience of retail and amenity at your doorstep. For boating enthusiasts, the opportunity to secure a private marina berth completes a truly unique Sydney harbourfront lifestyle.”

[smartcode_project:default project_id=13962 project_image_fid=291197]

PERIFA Managing Director and Co-Founder Fabrizio Perilli added that the diversity of housing across the precinct has been central to the project’s success.

“Whether it’s the heritage Halvorsen’s apartments, the Waterview Terraces or now The Residences, Putney Wharf offers a range of homes that respond to different lifestyles, all united by an unrivalled harbourfront setting,” Perilli said. “This is a precinct that will add lasting value to the Putney community.”

Managing project marketing and sales, <a href="https://www.apartments.com.au/project-marketer/srm-residential">SRM Residential</a> Partner Tim Rees said the final release has already attracted strong demand reflecting the project’s unique harbourfront position and the success of earlier stages.

“Following the strong response to both the Halvorsen’s Boatshed residences and the Waterview Terraces, The Residences represent the final chance to secure a new home within this tightly held waterfront precinct,” Rees said. “Buyers are drawn to the rare combination of absolute harbour frontage, parkside living and genuine architectural quality.”

[smartcode_project:default project_id=13962 project_image_fid=362240]

Putney Wharf is a one-of-a-kind mixed-use destination, delivering an exclusive residential offering alongside waterfront dining, retail and a 36-berth marina designed to the latest Australian Standards, accommodating vessels up to 18 metres and helping address Sydney Harbour’s ongoing marina shortage.

The precinct will include five retail tenancies and a prominent waterfront jetty area fronting the retail village, creating an activated harbourfront destination for residents and visitors alike.

Residents will enjoy direct access to lush harbourfront parklands, a public foreshore walkway and landscaped podium gardens connecting the development to the surrounding waterfront reserve. Construction across the Putney Wharf precinct is expected to be completed by Q2 2027.

Sales of The Residences officially launch this weekend, with the display suite open Saturday and Sunday from 10am to 12pm at Putney Wharf. Visitors are invited to enjoy a complimentary coffee while touring The Residences and experiencing the Putney Wharf lifestyle firsthand.

[smartcode_project_cta:default project_id=13962]

Final Harbourfront release in Putney Wharf launches this weekend

<a href="https://www.apartments.com.au/developers/draycon">Draycon Building</a> is nearing completion of Boutique Chevron Island, a 42-apartment development on the northern end of Chevron Island at 17–19 Parneno Street, with a limited-time offer of fully furnished apartments available.

Now more than 90 per cent complete, <a href="https://www.apartments.com.au/buildings/boutique-chevron-island-17-19-parneno-chevron-island-qld-4217">Boutique</a> has been shaped by one of the Gold Coast’s most tightly held island addresses, where riverfront outlooks and walkable access to Surfers Paradise converge.

For Draycon Building Managing Director Howard Dabit, the appeal of the site was immediate.

“I knew it was a good site as soon as I saw it,” Dabit said.

“The position and location on the north end of <a href="https://www.apartments.com.au/developments/chevron-island-qld-4217">Chevron Island</a>, the way the river swirls around the site basically from the north to the east, it feels like the site is surrounded by the water. The height that we’ve got and the aspect looking north is beautiful. Eighty per cent of the apartments are looking north so they get that drenching sunlight coming in.”

[smartcode_project:default project_id=89709 project_image_fid=360922]

That northern orientation places the development within a stretch of Chevron Island defined by open river aspects and skyline views, while remaining embedded in the suburb’s established village setting.

Chevron Island has increasingly drawn owner-occupiers seeking centrality without the intensity of high-rise beachfront living. Positioned at the geographical centre of the Gold Coast, the island offers direct access to both the beach and key cultural infrastructure while retaining a neighbourhood-scale character.

Connected by bridge to Surfers Paradise, Chevron Island offers walkable access to beaches, riverfront parklands and a revitalised foreshore boulevard animated by walkers and cyclists throughout the day. The Pacific Ocean is only minutes away, reinforcing the suburb’s dual river-and-surf identity.

At the same time, Thomas Drive forms the spine of the island’s village life, delivering cafés, wine bars, casual dining and everyday services within easy reach. Independent grocers, wellness operators and neighbourhood retailers contribute to a community atmosphere that remains distinct from the vertical scale of the beachfront.

[smartcode_project:default project_id=89709 project_image_fid=360915]

In the opposite direction, the Green Bridge links directly to HOTA – Home of the Arts – placing galleries, performance venues and parklands within walking distance. Weekly markets and major exhibitions draw visitors from across the region, while residents return to a quieter residential pocket at day’s end.

Public transport, including nearby bus routes and the G:link light rail corridor along the coastal spine, strengthens connectivity north and south. Griffith University, the Gold Coast University Hospital precinct and established private schools such as The Southport School are all within a short drive.

Ongoing investment across Surfers Paradise, HOTA and the broader Southport corridor has elevated amenity while preserving Chevron Island’s comparatively low-rise residential character. It is this balance, walkable village atmosphere paired with metropolitan-scale infrastructure, that continues to differentiate the suburb from higher-density beachfront precincts.

Boutique comprises just 42 residences, designed to maximise river and skyline outlooks within this tightly held island setting.

Boutique Chevron Island is slated for completion in April 2026, with prices starting from $1,220,000.

[smartcode_project_cta:default project_id=89709]

Draycon Building’s Boutique Chevron Island places 42 residences at the heart of the Gold Coast

Sydney developer <a href="https://www.apartments.com.au/developers/deicorp">Deicorp</a> has secured planning approval for a $300 million residential development in Lindfield, marking the company’s second project on Sydney’s North Shore and its first on the Upper North Shore.

Located on Beaconsfield Parade and designed by DKO Architecture, the state significant development comprises three buildings of up to 10 storeys and will include 399 residences, including 59 affordable homes and 40 adaptable homes.

Residences will range in size from one, two and three bedrooms, with two-bedroom apartments accounting for over 60 per cent of the product make-up. Residents will have access to a broad suite of amenities, including a wellness area, indoor and outdoor recreational spaces, a pool, a gym, a community room and a golf simulator.

In line with Deicorp’s long-standing focus on creating transit-oriented communities, the project is located just 260 metres from the Lindfield Train Station, reinforcing its role in delivering well-connected housing close to established infrastructure, retail and local services.

The inclusion of affordable and adaptable housing supports greater diversity within the local market, while the mix of apartment types responds to demand from downsizers, young professionals and families seeking access to the Upper North Shore.

Deicorp Founder Fouad Deiri OAM said the approval represents an important milestone for both the company and the suburb

“This approval allows us to deliver well-designed homes in a location that is already supported by strong transport and community infrastructure," Deiri said.

"Our focus is on creating places that integrate into their surroundings and provide long-term value for residents, and the broader Lindfield community. Being within walking distance of the station ensures this project supports sustainable growth in the right locations."

Across its portfolio, Deicorp currently has 4,703 apartments under construction, playing a leading role in shaping connected, liveable communities across Sydney.

Its expanding portfolio of Metro-linked developments includes Tallawong Village, <a href="https://www.apartments.com.au/new-apartments/kings-bay-village-five-dock-53-75-queens-road-five-dock-nsw-2046">Kings Bay Village</a> in Five Dock, <a href="https://www.apartments.com.au/new-apartments/hyde-metropolitan-sydney-133-141-liverpool-street-sydney-nsw-2000">Hyde Metropolitan</a> in Sydney CBD, <a href="https://www.apartments.com.au/new-apartments/falcon-alexander-crows-nest-8-alexander-street-crows-nest-nsw-2065">Falcon &amp; Alexander</a> in Crows Nest and Showground Village, Castle Hill.

Deicorp purchased the Beaconsfield Paradise site last year. Construction is scheduled to commence in Q2 of 2026 and will be completed in 2029.

Deicorp expands portfolio to nearly 5,000 apartments with Lindfield project

In a joint venture with The Trump Organization, Australia developer Altus Property Group has announced plans to bring a Trump International Hotel &amp; Tower to the Gold Coast, marking the first Trump-branded project in Australia.

"Trump International Hotel &amp; Tower, Gold Coast is our first official project in Australia and reflects our unwavering commitment to delivering world-class luxury experiences in iconic locations around the world," Eric Trump, Executive Vice President of The Trump Organization, said.

"This development exemplifies the Trump brand’s dedication to quality, sophistication, and unmatched service, and we are thrilled to bring this vision to the vibrant Gold Coast community."

The 91-storey building, which will become the tallest in Australia at 335 metres, will feature a&nbsp;285-room luxury hotel bearing the trademark Trump logo. It will also include 272 luxury residential apartments, a three-level podium with an exclusive Beach Club, and over 3,400 sqm of premium commercial, retail, and dining space, revitalizing the central Surfers Paradise precinct.

“Trump International Hotel &amp; Tower, Gold Coast will be a truly unique offering in the Australian market, bringing the prestige and allure of a world-class luxury brand,"&nbsp;Altus founder and chief executive David Young said.

"Altus Property Group is proud of its track record in delivering landmark developments across Australia, and our expertise ensures this project will be an outstanding success."

Trump Hotel heads for the Gold Coast to become Australia's tallest building

Financial Regulation

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Investors should expect regulations that allow self-managed superannuation funds to borrow to buy property to come under government scruitiny in the coming months, an expert in the area has said.
In February, Assistant Treasurer Arthur Sinodinos ruled out a specific review into limited recourse borrowing arrangements which SMSFs use when taking out loans to buy property.
Macquarie Bank executive director David Shirlow told Property Observer it was unlikely that the government would change its position, despite Senator Sinodinos standing aside and Finance Minister Mathias Cormann taking over as Acting Assistant Treasurer.
“Whilst the prospect of a separate and specific review of the matter is off the policy agenda for the time being, there are still some live policy issues in borrowing through super,” said Shirlow, who specialises in SMSFs and sits on the board of the SMSF Professionals’ Association of Australia (SPAA).
He said some stakeholders had argued that it was inappropriate for SMSFs to borrow for property investment at all, and that further constraints on advice provided regarding limited recourse borrowing arrangements and product offerings could be considered.
The arrangements are likely to be examined as part of the Financial System Inquiry, which is due to publish an interim report in mid-2014 and a final report by November.
Numerous submissions to the Inquiry have called for government to review SMSF borrowing and put in place additional consumer protection measures and education for trustees.
Big four accounting firm KPMG noted in its submission that super funds were tax-exempt in the pension phase, which provided incentives for SMSFs to invest in long-term assets such as residential property, and even more so if the property was negatively geared.
The Institute of Chartered Accountants in Australia strongly encouraged a review of existing arrangements to ascertain whether borrowing was appropriate and, if it was, to ensure the right legislative and regulatory frameworks were in place.
Mid-tier accounting firm Chan &amp; Naylor called for urgent action to create a dedicated national SMSF educational framework, lead by the Australian Securities and Investments Commission (ASIC), to teach the public about the merits and pitfalls of SMSF investments.
The Reserve Bank of Australia noted that SMSFs borrowing could expose members to greater financial risks (including excessive concentration in a single asset) than they understood they were taking.
CPA Australia raised concerns about the appropriateness of advice received by SMSF trustees and members, and potential misinformation being provided by unlicensed advisers such as real estate agents, mortgage brokers and property developers.
Shirlow said ASIC considered itself to have jurisdiction, under the Corporations Act, over some aspects of property sales people giving advice on limited recourse borrowing arrangements.
“Stakeholders such as SPAA would argue that there should be some more definite consumer protection rules in place to make sure that property spruiking is not going to lead to disaster,” he added.
The Association of Superannuation Funds of Australia has previously advocated for advice to SMSFs on asset classes such as investment property and limited recourse loans to be provided only through licensed financial planners.
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Investors should expect SMSF borrowing to come under greater government scrutiny

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The Council of Financial Regulators (CFR) met to discuss financing conditions, the housing market, Cyber risk initiatives and the lending market.
During the meeting they said that growth in housing credit remains subdued overall, with credit to investors particularly weak.
Owner-occupier loan commitments and housing turnover in Sydney and Melbourne have picked up, suggesting that a strengthening in credit growth is likely.
Mortgage lending standards have been broadly unchanged recently.
Overall, near-term risks related to the housing market have lessened as housing market conditions nationally have improved.
Members discussed the potential for the current weakness in apartment construction to place upward pressure on prices in some cities over time unless construction picks up. They also discussed the tight credit conditions for small businesses and the reduced risk appetite by many lenders for lending to small business.
Concerning responsible lending new ASIC guidance will confirm that responsible lending requirements do not apply to loans made predominantly for business purposes, regardless of the type of security offered for the loan.
Council members stressed that the flow of credit is fundamentally important to the functioning of the Australian economy and discussed the concern that lenders' risk appetite for some types of lending may have swung too far towards caution.
The CFR met with representatives of the Department of Home Affairs and the Australian Cyber Security Centre (ACSC) to review the current cyber security environment. They also discussed key initiatives to improve cyber resilience, including the development of the Government's 2020 Cyber Security Strategy, and application to the financial sector.
Council agencies, the Department of Home Affairs and the ACSC will continue to cooperate to improve the preparedness of the financial sector.
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Council of Financial Regulators say short term housing market risks lessen

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Louise Sylvan's review of Financial Counselling Services has been released with banks hoping it will help them chart a path towards strengthening Australia’s financial counselling sector.
The Review highlights systematic issues that have plagued the the industry, while noting the importance of financial counsellors in helping Australians who are struggling to repay their debts, manage their household budgets, and provide for their families in a difficult environment.  
The CEO of the Australian Banking Association, Anna Bligh, said that financial counsellors were important to Australians and the banking industry who see them as valuable partners in helping vulnerable customers.
“Financial counsellors get people back on track when they’re experiencing some of the most difficult moments in their lives and provide a valuable education service to people with lower levels of financial literacy and capability,” Ms Bligh said.
“This review charts an important path forward to strengthen Australia’s financial counselling sector.”
Louise Sylvan, who is the former deputy chair of the ACCC, was appointed to lead the review earlier this year, after the Royal Commission (into Misconduct in the Banking, Superannuation and Financial Services Industry) highlighted widespread unethical and criminal behaviour in financial counselling sector.  
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Banks to step up after review into financial counselling sector

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GUEST OBSERVATION
Will the banking services royal commission have a lasting effect of improving the banking and financial sector? The answer is “no”. A temporary change is apparent, but the problems lie deeper than those <a href="https://theconversation.com/banking-royal-commission-no-commissions-no-exemptions-no-fees-without-permission-hayne-gets-the-government-to-do-a-u-turn-110974" target="_blank">addressed by the royal commissioner</a>.
The worldwide pervasiveness of financial sector misconduct is an indication.
This is not a criticism of the Royal Commission as such. It had a limited mandate and limited time, although its approach of focusing on Australian case studies further limited its scope. And a broader investigation of economic and social underpinnings of financial sector misconduct would have required a different sort of Inquiry.
It’ll be hard to act on the report we had
Even then, any recommendations for fundamental changes to financial sector structure and activities needed to inhibit misbehaviour would have to run the gauntlet of gaining political support in the face of vested interests.
The response to, and government capitulation on, the Hayne recommendation regarding <a href="https://theconversation.com/sam-and-the-honest-broker-why-commissioner-hayne-wants-mortgage-brokers-to-charge-fees-114071" target="_blank">mortgage broking fees</a> starkly illustrates the point.
Why will the recommendations not be a lasting solution? An important reason is that the royal commission interpreted “behaviour consistent with community standards” in a limited way to refer to situations in which customers were actually harmed.
But much of community angst over financial sector conduct relates to the broader use of market power and superior knowledge to extract an “unfair” share of the benefits from transactions with customers.
And it missed the broader problem…
Customers don’t get a fair share of the benefits from transactions, competition doesn’t work to make sure they do, and customers are often unaware that they have been exploited.
Why is it happening? The answer lies partly in this comment of Royal Commissioner Kenneth Hayne on page 54 of his <a href="https://financialservices.royalcommission.gov.au/Pages/reports.aspx#interim" target="_blank">interim report</a>: "Much if not all of the conduct identified in the first round of hearings can be traced to entities preferring pursuit of profit to pursuit of any other purpose"
Economists will rightly argue that there is nothing inherently wrong with the pursuit of profit or self-interest. It facilitates the efficient allocation of resources.
But unless it is accompanied by a concern with fairness (“do unto others as you would have them do unto you”) in situations of market power and superior information, as typically occurs in financial markets, it will lead to vulnerable consumers being exploited.
…which is a grey zone of unfairness
There is a large and poorly defined grey area between self-interested but clearly fair behaviour and self-interested unfair behaviour, which, in turn, merges into misconduct and illegal activity.
It is difficult for (particularly large) institutions operating in that grey area, even if committed to “fairness”, to ensure their employees do not slide towards the boundary. Or over it.
Moreover, competition between financial institutions in search of profits can lead to a “race to the bottom” in terms of lower financial product quality. This is not always apparent to some (or many) consumers – at their expense.
The financial sector particularly vulnerable to this problem.
First, many financial products and services are “<a href="https://www.investopedia.com/terms/c/credence-good.asp" target="_blank">credence goods</a>” where the consumer needs them but is unable to assess their real worth either before or after the purchase.
A perfect example is a visit to the doctor. Often the reason we are visiting the doctor is because we don’t know what’s wrong with us. It makes it necessarily difficult or impossible to tell whether the doctor is good at her job.
Bankers sharpen their claws on each other
Second, much of the activity in financial markets is about trading and making profits (supposedly using superior information and expertise) at the expense of the another party in those markets.
If it is “right” for that part of the entity that does that to make money at someone else’s expense, why is it wrong for the part of the entity that deals with consumers to do that?
Here’s how the Commission could have tackled these problems in order to achieve real, longer term benefits.
Yet we license them…
First, it could have considered whether giving financial institutions a valuable “social licence” to operate in important business areas under advantageous institutional structures should bring with it extra enforceable obligations.
It could have also considered whether, given the lack of misconduct found in the mutual and cooperative sector, banks and other financial institutions could be organised more like mutuals.
Second, it could have recommended changes that would have given stakeholders other than shareholders (such as depositors and employees) a greater say in running those organisations (perhaps at board level) and a say in shaping their culture.
…and we could change the way they’re run
Third, it could have recommended structural separation between the retail and wholesale arms of firms to reduce complexity and the risks of deficiencies in control systems.
Structural separation could have also reduced the risk that the culture of trading and position-taking, in which profits are made at the expense of another party, spilled over into other parts of the institution where it wasn’t wanted.
Finally, it could (and should) have concentrated more on consumer protection.
It is a much broader issue than deterring and penalising misconduct.
Until consumer financial literacy catches up with financial product innovation and complexity, there will continue to be a big “market for financial misconduct”.
Exhorting institutions to do no harm won’t take it away.
Kevin Davis, Professor of Finance, University of Melbourne
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/do-no-harm-isnt-enough-why-the-banking-royal-commission-will-ultimately-achieve-little-116076" target="_blank">original article</a>.
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Why the banking royal commission will ultimately achieve little

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The Australian Securities and Investments Commission (ASIC) has noted the decision by Premier Investments Limited (Premier) to write down the value of its casual wear brand name assets by $30 million in its financial report for the year ended 28 July 2018.
ASIC had raised concerns on the value of these assets in Premier’s financial report for the year ended 29 July 2017.
They had questioned the "reasonableness and supportability of royalty rate assumptions and sales growth forecasts used in testing the assets for impairment".
ASIC stated: "Premier has referred to the increasingly competitive retail landscape and structural changes impacting the apparel industry in Australia and New Zealand."
The impairment of non-financial assets remains a "focus area of ASIC’s financial reporting surveillance program".
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Premier Investments write down brand name assets

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The financial services Royal Commission seems set to have significant consequences for home borrowers, and the impact will hit a lot quicker than any interim or final report to the Federal Government.
It already seems likely Commissioner Kenneth Hayne will recommend sweeping changes to the home loan industry arising out of just the first few weeks' hearings.
He has uncovered dreadful lending practices by banks and mortgage brokers.
The worst was NAB employees in greater western Sydney accepting cash bribes over the counter in white envelopes to facilitate loans they knew were based on fake documents in order to collect bonuses.
The fraud and bribery came with the manipulation of a mortgage commission incentive program that incentivised gym owners, taxi drivers, hairdressers and sporting clubs who made money by referring customers to the bank.
Then there's the more prevalent, so-called liar loans, where mum and dad borrowers simply skirt around the reality of their income, expenses, debts and assets when filling in their successful loan applications without much checking by the banks.
"By and large customers are poor historians when it comes to identifying their outgoings," Commissioner Hayne drily noted.
The regulatory backdrop has been Wayne Byres, the chairman of the Australian Prudential Regulation Authority, moving over recent times to put the brakes on dubious lending.
Byres has sought to ensure that standards for property lending are prudent, particularly in what he viewed as an environment of heightened risk.
Given the Australian banking system's very high exposure to both the residential mortgage and commercial property markets, APRA's ultimate goal was to protect bank depositors, because it's their money that banks are lending.
You would expect as Commissioner Kenneth Hayne uncovers further misconduct or poor lending oversight, getting an honest home or investment loan will become a lot harder for borrowers.
And any reining in the bank's zealous willingness to lend will trigger the possibility of a Royal Commission-induced credit slowdown.
This could impact on interest rates.
According to Shane Oliver, chief economist at AMP Capital, tighter lending may have the effect of pushing the next interest rate rise back to 2020, rather than 2019.
"It seems a real risk around the issues of lax lending standards is that banks move to a far more rigorous assessment of applications for loans," Shane Oliver noted.
This was unlikely to cause a full-on credit crunch, Oliver forecasts, but more likely a slowing in credit growth.
UBS analysts have warned too there is a growing risk the RBA was under-estimating the downside risk from tightening lending standards.
“While a tightening of mortgage underwriting standards is prudent, it has a material impact on the economy,” UBS noted.
“It must be remembered that house prices are determined by the demand and supply of credit, not the demand for and supply of housing,” UBS advised.
This article first appeared in The Daily Telegraph.
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Financial Services Royal Commission to have big impact on home borrowers

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GUEST OBSERVER
A Productivity Commission report analysing competition in the financial sector has pointed out that our finance regulators have become enablers of an industry that is an impediment to our economic competitiveness and exploitative of their most loyal customers.
It proves the need for a board to oversee the conduct of our financial regulators, policing the bodies that are supposed to be keeping our financial system in check.
It could not have come at a worse time for our big four banks. Perennially pilloried for their rampant market misconduct (fraudulently manipulating benchmark interest rates) and their equally rampant abuse of upwards of hundreds of thousands of consumers across every one of their retail operations at one stage or another – financial advice, life insurance and credit card insurance, just to name a few.
The Australian Securities and Investments Commission (ASIC) most recently launched a bank-bill swap rate manipulation case against the Commonwealth Bank, but only across a very narrow range of infringements. The bulk of the infringements can’t be prosecuted because ASIC has dithered for so long, the statute of limitations has run out, and the alleged crimes have proscribed.
And what of our other financial regulator - the Australian Prudential Regulation Authority (APRA)? The Productivity Commission reckons that APRA’s ham-fisted use of macro-prudential tools, usually used to reduce risk in our financial system, has benefited the big four banks to the tune of A$1 billion.
APRA has been criticised for pursuing stability in a manner that has killed competition, hurt consumers, and starved small businesses of life-giving capital. The dominance by a few banks, whose profits are based on runaway property prices, is its own systemic threat.
The result is that small banks are squeezed out, big banks raking in higher rates, and investors offsetting higher rates against their taxes and so costing the Australian Taxation Office an estimated A$500 million in deductions. As the old saying goes, when your only tool is a hammer, every problem looks like a nail.
Who will regulate the regulators?
So what to do about ASIC and APRA? Back in 2014, the Financial System Inquiry recommended a board of oversight – a regulator for the regulators – to ensure that the regulators discharge their mandates.
So, for example, to ensure that ASIC acts like a cop, not a co-op; that APRA acts with foresight and finesse, as opposed to damaging competition. APRA and ASIC pushed back at the time, and the Abbott government rejected the recommendation.
Now to add impetus to the Financial System Inquiry recommendation, the Productivity Commission says there is a lack of transparency and accountability exhibited by our regulators. Add to that the implications regarding regulator’s efficacy that comes with the establishment of the Financial Services Royal Commission. The public deserves better than this.
A regulator for the regulators – a Financial Regulator Assessment Board – would conduct ex post analyses of how regulators had discharged their mandates, evaluate their policies and the efficacy of their policy tools. It would be a sober second thought, and a crucial mechanism of double redundancy – to pick up on crucial elements that the regulator may have overlooked.
The idea has form. The British have created something similar, called a Financial Policy Committee, this body’s aim is to review the British regulators, while keeping a look-out for where the next “bombshell” may come from.
That development in turn builds on the work of James Barth, Gerard Caprio and Ross Levine whose research indicates that regulators simply cannot be trusted to perform these crucial functions as the guardians of finance, without oversight. The researchers call their proposed board of oversight the “Sentinel”, and point out that no industry is more adept and more practised at suborning the guardians of finance than banks and insurers. Sound familiar?
<img src="https://counter.theconversation.com/content/91396/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">Australia’s financial system is increasingly governed by a lawless financial sector, presided over by regulators that are at best misguided, and at worst captured. A board of oversight is the least we can do.
Andrew Schmulow, Senior Lecturer, Faculty of Law, University of Western Australia
This article was originally published on <a href="http://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/australias-financial-regulators-need-policing-91396" target="_blank">original article</a>.
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Australia's financial regulators need policing: Andrew Schmulow

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The number of houses being passed in at auctions and the easy availability of inner-city apartments is not just the result of regulatory measures, but also a loss of confidence stemming from the extremely tight bank lending rules.
Columnist Robert Gottliebsen labels it as the “tea, coffee and cosmetics” (TCC) approach to home lending in his recent piece in The Australian.
While attempting to explain the confusion among many young real estate agents about the number of houses passed in and the desperation of apartment developers to sell, Gottliebsen says there are many reasons, but “none so powerful and potent in what is happening in the lower management levels of some of the big banks”.
He says it’s conventional to blame the APRA and the regulators for the credit squeeze but the problem is “multiplied by a middle management loss of confidence stemming from the looming retrenchments and the bank scandals”.
This has forced the banks to be more restrictive, especially the ones facing scandals such as the Commonwealth Bank.
TCC has even spread to small business lending, writes Gottliebsen.
He says borrowers are shocked that the new tests by banks had slashed the amount they would lend by a quarter and even a third. 
Borrowers are being asked for information about basic living expenses, such as clothing, footwear, cosmetics, dining out, after-hours school care, dining out to name a few.
Gottliebsen states that this banking approach, which he has spoken of earlier, if it continues will see more serious falls in the prices of dwellings, widening the 10% fall in Sydney apartments to other areas of the residential market, including Melbourne.
This is already the case in inner city markets of Sydney, Melbourne and Brisbane now, which also have many unsold houses now.
He says the “crackdown is much wider than TCC and covers restrictions on interest-only loans, higher interest rates for investors, threats of higher interest rates, no money for Chinese borrowers” and so on.
Also, the rising gas and electricity bills further hit confidence.
“The trouble with these uncoordinated attacks is that they start with the aim of stopping a boom, which threatened to turn into a bubble collapse.”
According to Gottliebsen, this activity looks very little on the surface initially and as the squeeze continues, it hurts confidence.
“We are not there yet but once it happens — and the illogical approach of TCC lending will bring it on — confidence will take a long while to restore.
“And it spreads to small business.”
But the banks’ reluctance has opened up opportunity for non-bank lenders, which are seizing the opportunity.
The “regulators’ response is to clamp down on filling the bank-created void, so damaging the nation”.
In conclusion, Gottliebsen suggests that a banking royal commission is not a “good idea at this time”, but if there is one, it should cover regulators too.
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Borrowers face shock when banks slash home loan approvals by at least a quarter: Gottliebsen 

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Australian Prudential Regulation Authority chairman Wayne Byres has said the “community trust and confidence was an important consideration” behind its recent inquiry into money laundering involving the Commonwealth Bank.
He said the CBA has experienced a number of incidents over recent years that have damaged its reputation.
“After the AUSTRAC matter came to light, it was difficult to see how the bank could quickly remedy the situation by itself,” he said.
The APRA chairman’s statement came during his opening statement to the House of Representatives Standing Committee on Economics.
Byres said the inquiry is expected to reaffirm to the larger public of that regulators were working on addressing irregularities and would send a signal to other lenders as well.
“In that sense, we very much see the Inquiry as making a constructive contribution to strengthening the reputation and public standing of the bank,” he said.
“As an added benefit, any issues identified will provide useful learnings to others in the industry.”
He also said that the the risks in the housing market that were pointed out in APRA’s 2015/16 Annual Report still hold.
“We called out risks in the housing market, the funding profile of the banking system, poor experience in some segments of the insurance industry, and the need to enhance governance and transparency in the superannuation industry. These issues remain prominent today,” said Byres.
Although he said that at a macro level, Australia continues to benefit from a sound financial system that reflects a long period of economic growth and resilience in financial institutions. 
However, there was no room for complacency.
Byres also used the opening remarks to update the committee on APRA’s response to the recommendations from the Committee’s Review of the Four Major Banks.
One of the recommendations was for a review of the licensing requirements for Authorised Deposit-taking Institutions (ADIs) and there were several others designed to strengthen accountability and transparency of financial institutions.
The Banking Executive Accountability Regime (known as the BEAR), will increase APRA's powers, that among other things, include fines to be imposed on errant ADIs.
He said the core objective of the BEAR was "establishing clearer accountabilities for, and expected standards of behaviour by, senior executives within banks" and was being constructed in a manner that is consistent with APRA’s prudential mandate.
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APRA chairman says CBA inquiry will establish public trust

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Jana Jaros and Jackson Laurence Malcolm Capper have appeared in the Southport Magistrates Court on charges of operating an unlicensed financial services business following an ASIC investigation.
ASIC documents state Ms Jaros and Mr Capper have been charged under section 911A of the Corporations Act for allegedly aiding and abetting Astra Group Pty Ltd and Old Cambridge Pty Ltd to carry on a financial services business without holding an Australian Financial Services licence.
They also face two charges each under section 1308(2) of the Corporations Act for lodging with ASIC documents containing false or misleading material.
Providing assistance to operate an unlicensed financial services business carries a potential maximum penalty of $36,000 or two years' imprisonment or both, while providing false or misleading documents carries a maximum penalty of $36,000 or five years' imprisonment or both.
This matter is being prosecuted by the Commonwealth Director of Public Prosecutions.
Ms Jaros and Mr Capper appeared on 7 August 2017. The matter was adjourned until 4 September 2017.
Background
ASIC alleges that Ms Jaros and Mr Caper set up the websites www.investradirect.com and later www.investradirect.co to attract and service clients of Astra Group Pty Ltd and Old Cambridge Pty Ltd.
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