With John Howard’s great mate Maurice Newman as chairman, the ASX was always confident it could get whatever it wanted out of Canberra. Maurice even landed the plum chairmanship of the ABC.

Alas, the change of government ushered in a big debate about the obvious conflict of interest that comes from having a for-profit monopoly doubling up as a regulator – something which should never have been tolerated in the first place back in 1998.

The ASX will “die in a ditch” to retain those regulatory powers but the Opes Prime fiasco will almost certainly put paid to its ambitions. It is now simply a question of how far Labor goes.

ANZ is also facing its greatest brand crisis since the infamous $600 million loss that was declared in 1992. Never before has a banking workout triggered such far-reaching ramifications for equity investors. And never before has Australia seen such a fire sale with $2 billion worth of assets owned by 1,200 Australians disappearing in a matter of days.

Goldman Sachs-JB Were has been handling the fire-sale in a very private manner. There were no public advertisements of all that was available like a normal liquidator’s auction.

Such was the secrecy and haste, ANZ failed to even lodge substantial shareholder notices when it suddenly controlled more than 5% of dozens of small companies. In yet another folly, this was because the regulators apparently gave them a waiver.

The demise of Opes is simultaneously changing board, CEO, shareholder and takeover dynamics in dozens of companies whilst also imposing a shock credit squeeze on shareholders in hundreds of companies because no other broker or banker will lend against such risky companies.

I’m with Commsec but they won’t lend against more than half of the 650 companies in the portfolio. Why on earth not? Think about it for a moment. Do banks ban lending against the worst or smallest houses in the street?

Commsec, and Opes for that matter, would not lose a single dollar if it operated under this very simple rule: we’ll lend up to 50% against every single listed company but no single stock can be more than 20% of the portfolio.

The Opes problem was not lending against rubbish stocks, it was refusing to margin call troubled clients such as Chris Murphy, who Michael West has revealed today had loans of $168 million supporting investments of just $180 million last July – before the credit crunch hit.

Today’s Mayne Report video covers Centro, David Tweed, Westfield, Fosters and a colourful mailbag.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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