1. Australia
As all other economies suffered the biggest recession in 80 years, Australia was one of only a handful of countries to record a rise in gross domestic product (GDP). The country’s GDP grew by 0.4 per cent in the first quarter of 2009 and rose to 0.6 per cent in the second quarter.
As the financial crisis worsened, the World Bank gave Australia a glowing report card, with World Bank managing director Juan Jose Daboub labelling Australia a “model economy” and an example for other nations struggling to recover from the financial crisis. However, the economic growth is in large part due to recovering demand for commodities from China and successive government stimuli packages.
2. Banks
At a time when banks around the globe are grappling with bad balance sheets and toxic investments, Australia’s major banks have shone. International reports have shown that the development of the twin regulatory peaks, the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission, have created one of the most effectively regulated regimes in the world, and protected the banks from the near-death experiences of their international counterparts. All four major banks were named among the top 10 in the world in 2009, while profits for Australia’s major banks in 2009 were only marginally lower than the previous year.
3. Insurers
If there is one thing financial planners do during a market downturn, it is turn to life insurance. The growth of the risk insurance industry has been off the back of the financial crisis, with life companies such as Asteron experiencing a rise of 43 per cent compared to 2008. ING, too, has been a beneficiary of the downturn, recording a 25 per cent rise in its retail sales compared to the first quarter of 2008.
Traditional dealer groups that have focused on wealth creation have turned to risk insurance as a way of boosting their sales, while investors worried about their personal circumstances are taking up capital guaranteed products.
4. Chris Bowen
Formerly the Federal Assistant Treasurer in the Labour Federal Government, Senator Chris Bowen was promoted to Minister for Financial Services, Superannuation and Corporate Law in a cabinet reshuffle in June 2008.
Bowen was also given carriage of the human services portfolio, which includes the Government’s financial counselling services.
It is the first time the full financial services portfolio was brought under one minister. The elevation of Bowen to the inner cabinet, as well as receiving the dual portfolio, made Bowen the biggest winner of the cabinet reshuffle.
Financial planning associations welcomed Bowen’s appointment and praised his strong track record with the financial services sector and financial planners.
5. Retail master trusts
Retail master trusts have been big winners in 2009. As the financial crisis undermined confidence in financial planning and drove the establishment of self-managed superannuation funds (SMSFs), retail master trusts benefited from the trend, with up to 50 per cent of SMSFs moving on to retail platforms.
Retail master trusts overtook industry funds on investment returns in September this year and were tipped to move ahead of industry funds by as much as 4 per cent in October. Analysis has also suggested that master trusts might continue to outperform over the next six to 12 months as unlisted assets continue to move downwards.