Former Centro executives fined, Cash Converters shares hammered after deal falls over: Midday Roundup

Centro former chief executive Andrew Scott has been fined $30,000 for his role in the massive losses suffered by the company, while former chief financial officer Romano Nenna has been banned from managing corporations for the next two years, the Federal Court has ruled.

Justice Middleton handed down a judgement this morning in which the two executives, along with six non-executive directors, were in breach of the Corporations Act for not disclosing the company’s billions in debt.

ASIC was originally seeking fines of $100,000 for both executives.

Qantas, union to meet before Fair Work

Qantas and the union representing its pilots will meet before Fair Work today, in order to try and solve disputes over wages and working conditions.

The move comes after months of union troubles at Qantas, where groups representing pilots and engineers both threatening industrial action.

Qantas said in a statement the meetings were called because an agreement has still not yet been reached over a new enterprise agreement.

“Qantas values its 1650 long-haul pilots and the important work they do,” it said.

“Qantas is committed to reaching a fair agreement with its 1,650 long-haul pilots and are willing to negotiate reasonable increases in pay and conditions as well as productivity improvements that help position Qantas international operations for future growth.”

Cash Converters shares plummet 40%

Shares in Cash Converters plummeted 40% this morning after the company announced that a deal with EZCORP to take a stake in the Australian company had been abandoned.

The decision was made as a result of the Government’s move to amend the National Consumer Credit Protection Act to introduce caps on fees and charges for micro-lenders.

“Although the amendments have not yet been passed, as currently proposed those limitations could have a material impact on Cash Converters’ consumer loan business in Australia,” the business said.

“Accordingly, EZCORP is not willing to proceed with the transaction.”

Currently Cash Converters shares are down just 4% to $0.49.

The original proposal was made in March that EZCORP would buy 76.6 million shares, a stake of 53%. While the deal is now off, EZCORP chief executive Paul Rothamel said in a statement that “we still have a significant investment in Cash Converters”.

“Consequently, we are very interested in, and committed to, Cash Converters’ long-term success and look forward to finding other ways to proactively work with the Cash Converters team to achieve that success and maximise the long-term value for all Cash Converters shareholders.”

Private sector credit rises in July

Credit in the private sector provided by banks and lenders rose by 0.2% in July, according to the latest figures from the Reserve Bank of Australia.

Over the year, credit rose by 2.7%.

Shares weak despite higher US lead

The Australian sharemarket has opened weaker this morning after a choppy trading session in the United States, where consumer confidence has fallen to a two-year low.

The benchmark S&P/ASX200 index was down five points or 0.12% to 4264.1 at 12.10 AEST, while the Australian dollar has risen slightly to $US1.06c.

AMP shares rose 1.58% to $4.51, as commonwealth Bank shares fell 0.5% to $47.69. Westpac lose 0.49% to $20.38, as ANZ lose 0.45% to $20.09.

In the United States, a private gauge of consumer confidence found that consumers were now their most pessimistic in two years, fuelling fears that the country may fall back into recession.