🦘 ASX Sued By ASIC, CBA Reports $9.5 Billion Profit, Telstra And Optus Delay 3G Shutdown

G’day everyone!

Here’s what we’ve got in store for you today:

• ASX Sued By ASIC

• CBA Reports $9.5 Billion Profit

• Telstra And Optus Delay 3G Shutdown

Let’s have a look at the market snapshot before jumping into the news:

ASX Faces the Music: ASIC Sues Over Trading System Debacle

ASIC has taken the gloves off, suing Australia's stock exchange giant, ASX, over its chaotic attempt to upgrade its CHESS clearing and settlement system.

Back in 2016, the ASX dreamed big, partnering with New York’s Digital Asset Holdings to create a blockchain-based system set to revolutionize trading.

Fast forward to 2022, and after five delays and a damning independent audit, the project was a washout.

The crux of ASIC's lawsuit? ASX's February 2022 chirpy announcement that everything was “on-track” for an April 2023 launch. Spoiler: it wasn't.

ASIC Chair Joe Longo and Deputy Chair Sarah Court are pointing fingers at ASX for misleading the market, emphasizing the collective organizational failure.

ASX has now brought in India’s Tata to pick up the pieces and replace the existing system.

With full-year results looming and shares dipping by 3.7% to $63.45, the ASX is bracing for a rough road ahead.

As ASIC seeks legal declarations and penalties, this showdown could set the stage for a dramatic overhaul in market infrastructure. Stay tuned!

Commonwealth Bank Reports $9.5 Billion Profit Amid Rising Household Struggles

The Commonwealth Bank (CBA) just posted a $9.5 billion profit for the 2023-24 financial year, marking a 6% drop from last year's record profits.

The dip wasn’t much of a surprise, given rising operating costs mostly thanks to inflation.

CEO Matt Comyn pointed out that the economic landscape remains tough, particularly for younger Australians grappling with the high cost of living.

Despite the drop in earnings, CBA's loan impairment expenses decreased by 28%, thanks to solid credit practices and a bump in house prices, which kept defaults low.

Yet, there’s been a slight uptick in mortgage and consumer loan arrears, hinting at the ongoing strain on some households.

CBA's net interest margin - the difference between what they pay to borrow money and what they charge on loans - also took a hit, dropping to 1.99%.

For shareholders, the news wasn’t all gloomy. CBA declared a final dividend of $2.50 per share, bringing the total yearly payout to $4.65 per share.

Meanwhile, younger folks are tightening their belts, cutting back on non-essential spending as their savings dwindle, highlighting the uneven impact of inflation across different age groups.

With the economic outlook still dicey, CBA's cautious optimism about the future gives a mixed signal. Should we expect an interest rate cut this November? Only time will tell!

3G Shutdown Delayed Until October Amid Safety Concerns

Hold the phone, literally!

Telstra and Optus are postponing their planned 3G network shutdown from August to October 28, 2023, over public safety worries.

This delay buys extra time for folks with 3G devices to switch over to 4G or 5G, ensuring they’re not left in the lurch, especially in emergencies.

The two telecom giants are launching a joint public awareness campaign to get everyone up to speed.

Michael Venter, Optus' Interim CEO, stressed the need for device compatibility checks, particularly for emergency calls.

But it’s not just about phones; medical devices like pacemakers and fall alarms could be impacted.

Rural residents seem most vulnerable, facing issues with updating or affording new equipment.

Telstra’s exec Channa Seneviratne pointed out that this is probably the last extension.

Despite reassurances, the National Rural Alliance is worried, highlighting the potential risks to people with 3G-dependent medical devices.

Issues of reduced phone reception have also been reported even before the shutdown.

For now, the push is on for everyone to check their tech and ensure uninterrupted connectivity.

So, if you’re still on 3G, now’s the time to gear up for the future!

You Made It!

If you’ve read all the way up to here, we just wanted to let you know that you’re an absolute legend!

Time to go to work and show off how clued up you are about what’s going on in the business world 💪

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