Press digest australian business news march 20

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Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy. THE AUSTRALIAN FINANCIAL REVIEW (this site)Bond fund managers yesterday raised concerns about the dangers of acquiring government bonds as foreign investors began to reduce their bond holdings due to indications that the global economy may be improving. "The only reason you would buy bonds now is if you thought there was going to be another [global financial crisis (GFC)]. But I don't think we are going into another GFC," Kumar Palghat, managing director of boutique fund manager Kapstream Capital, said. Page 17.- - - - Cameron Edwards, former executive at Babcock & Brown Infrastructure and co-founder of the Westralia Infrastructure group, yesterday said his company was "liaising with the government and various miners" in Western Australia to "unlock the problems" with the state's Anketell Point port. The state government has said it would prefer financial institutions, super funds, third-party infrastructure providers and miners band together into a consortium to develop the venture. Page 17.- - - - One of the largest investors in Leighton Holdings yesterday said that "broader control of the company needs to be tightened up", a day after the corporate regulator fined the contractor A$300,000 for alleged violations of disclosure laws. Analysts, however, said the size of the fine was "immaterial" to the company, a view supported by investors who drove Leighton's stock up by A13 cents to A$23.90 yesterday. Page 19.- - - - Telecommunications giant Optus is planning to lay-off a significant number of its 9500 staff following a strategic review of its operations, the company confirmed yesterday. The move comes less than a fortnight after Singapore Telecommunications, the owner of Optus, announced it would restructure its business, a move that will end Optus' position as a separate business within the parent company. Page 19.- - - - THE AUSTRALIAN (this site)Bruce Teele, chairman of the Australian Foundation Investment Company, yesterday warned that the Federal Government's "new-fangled" carbon and minerals resource rent taxes were essentially "double-taxing" corporate income as they provided no credit to shareholders. "You get the impression that it's certainly Treasury policy, and maybe government policy, that the double-taxing of income streams certainly in the more prosperous companies is going to show," the closed end fund's chairman said. Page 21.- - - -

The Federal Government yesterday announced that the Australian Taxation Office would not penalise financial planners and their clients over commissions for financial advice if it is contracted before the start of July. The move is set to placate anger among financial planners over the Future of Financial Advice reforms, which legislates that advisers must act in the best interest of their clients. "We are entirely open to the pragmatic negotiation of implementation details," Financial Services Minister Bill Shorten. Page 21.- - - - Luxury retailer David Jones will continue to have its shares suspended from trading today after the company yesterday responded to rumours about earnings from its credit-card division. The company requested the market enact a two-day freeze on its shares "in light of speculation in the media", a move observers say was recommended to David Jones' board by Caroline Waldron, company secretary and in-house legal counsel. Page 21.- - - - Mining magnate Clive Palmer is on the verge of receiving A$183 million in royalties from the Chinese state-controlled Citic Pacific conglomerate. The payment is part of an deal signed six years ago that locked Citic into paying a royalty on 12 million tonnes of iron ore pellets and concentrate by the end of March next year, regardless of the overall level of production. Page 21.- - - -

THE SYDNEY MORNING HERALD (this site)Glenn Stevens, governor of the Reserve Bank of Australia, yesterday told an investment forum in Hong Kong that foreigners held a higher view of Australia than Australians do. "For most of my career the difference has tended to be in the opposition direction. We always seemed to struggle to get foreign observers to give us credit for performance we thought was pretty reasonable," the central bank's governor said. Page B1.- - - - Experts in corporate governance have supported the Australian Securities and Investment Commission's push to introduce harsher fines when companies breach disclosure laws. The call comes after contractor Leighton Holdings was fined A$300,000 for failing to quickly inform investors of a A$900 million plunge in its finances. "There's a real problem in the system," Professor Ian Ramsey from the University of Melbourne's centre for corporate law and securities regulation said. Page B3.- - - - Brendan O'Connor, Federal Minister for Small Business, yesterday called on small business owners to come forward with proof that major corporations and companies like shopping centre owners had abused their power in negotiations. "If there's a compelling case to be made about the relationship small business has with big business and whether in fact we've got the balance right, I'm very happy to listen to their concerns," the minister said. Page B3.- - - -

The Australian Taxation Office has lost a long-running legal battle in the Federal Court against agribusiness Elders Ltd, a ruling which the latter expects to result in a significant cash windfall. "Should the [Tax Office] not appeal or special leave is not granted by the High Court, Elders anticipates receipt of A$38.5 million by way of refund of pre-paid tax, penalties and interest of A$27.6 million and interest on that pre-payment currently estimated to be A$10.9 million," Elders said yesterday. Page B3- - - - THE AGE (this site)Analysts have questioned the capacity of NBNK, a buyout fund in the United Kingdom, to acquire National Australia Bank's British banking division, following revelations that the fund's chief executive recently considered joining a rival finance group. NBNK was established last year to purchase Lloyds Banking Group's 632 branches, but it changed its focus to National Australia Bank's Clydesdale assets after losing out as preferred bidder. Page B3.- - - - More than US$230 million of trade was sacrificed last weekend after resource companies were forced to suspend operations due to the category four cyclone Lua. The cyclone crossed Western Australia's north-west coast on the weekend, resulting in approximately US$230 million in lost trade according to current iron ore prices. Global miner BHP Billiton yesterday refused to detail how much affect the natural disaster would have, saying any impact would be revealed in its next production statement. Page B3.- - - - Gold producer Newcrest Mining yesterday admitted to the market that its contract to mine at the Gosowong site in Indonesia could be altered to match up with the country's new mining legislation. Indonesia recently legislated that all resources projects must be 51 percent owned by a local entity within the first 10 years of a mine's production, up from a previous cap of 20 percent. Page B4.- - - - The Department of Insurance in the United States' California has raised concerns that insurers, including local group QBE , lower premiums for controversial force-placed insurance policies. The move comes as the Australian insurer already faces two class action lawsuits in the state, with home owners alleging that the insurer paid kickbacks to financial institutions and engaged in collusion and profiteering. Page B5.- - - -