[Weekly Wrap] How's your moral compass?

Two of our regular topics dominate the news this week, namely the Code Committee and Hanover.

Friday, November 20th 2009, 4:00PM

I thought I would start with Hanover today, as the story is fascinating and it has one thing in common with adviser regulation. The common thread is that the naysayers and knockers seem to be getting all the airtime at the moment.

I'd have to admit to being gobsmacked over some of the commentary the mainstream media has chosen to air about Hanover, particularly on the broadcast news. At face value, the deal has some merit to it, but it is complex and investors need all the help they can get to understand it. Pity then that much of the commentary has been about Hanover's two shareholders, Mark Hotchin and Eric Watson, and much of what has been said is inaccurate, emotive and misleading.

Some of the comments made by Allied Farmers have portrayed the finance company market in a way many probably haven't thought about. One comment made by chairman John Loughlin, was that he only saw mortaria as an interim step to some other end. He may well be right, in hindsight, but I am sure that is not what investors thought when they voted on these schemes.

Secondly, I have called Allied's deal "brave". The telling quote for me in the press conference I listened into was: "We're acquiring challenging assets with uncertain value". For updates on this story, relevant documents and releases and comments visit Depositrates.co.nz.

This week we have seen another Code Committee discussion paper, this time on regulation. We have two stories on that, plus the full paper. Also the commissioner doesn't think it is a problem that there is little adviser representation on the body charged with making operating rules for financial advisers. Meanwhile, the Insurance and Savings Ombudsman scheme looks like being opened up to advisers.

Yes there was some other news this week. One piece we ran on Good Returns was that Australian researcher Van Eyk is entering the New Zealand market. Also we have some KiwiSaver performance numbers showing - not unsurprisingly - that growth funds are starting to move up the league table.

Across at our new site for accountants, Netprophet.co.nz, we have an investment feature on currency hedging. You can see the story here. (If you work with any accountants please tell them about the site).

For risk advisers we have details of The National Partnership's new Academy, appointments at Asteron designed to fuel growth and Russell Hutchinson's latest opinion piece: Advice counts and you have to have a method.

The other appointment story this week is that the former head of AMP Capital has joined the NZ Superfund.

To close out the week we have a bunch of investment stories including:
CBS Canterbury 'very happy' with BB+ credit rating
Boston Finance placed in receivership
Deposit guarantee scheme gets tweaked
Fisher & Paykel and UDC hike rates
The Hawk set to swoop on Cynotech

Have a great weekend
Philip

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