THE NEWS WRAP: New bank rules could push up borrowing costs

Small businesses have been warned that they could be hit by higher borrowing costs under international banking regulations.

Analysts expect that Australian banks are well placed to meet the tough new regulations put in place globally, but lending rates could rise as a result.

Banks will be required to have double the capital reserves available to protect against GFC-style losses, but small firms may pay the price through higher interest rates.

Personal property rules

Small firms will also have to watch out for new personal property securities legislation that takes effect in May.

Under the new federal rules, which bring together around 70 regulations into one requirement, businesses will have the register their ‘security interests’ over all their assets on a national online database.

Tangible personal property such as cars, boats and machinery will have to be listed, as well as intangibles such as shares and intellectual property.

Branson blues

Just days after Virgin Blue’s planned link-up with Air New Zealand was blocked by the ACCC and Sir Richard Branson’s Australian airline is facing another challenge from the competition watchdog.

Qantas has complained to the ACCC about Virgin Blue’s alliance with Etihad, jeopardising the wide-ranging international overhaul of the airline.

Sydney plan given SME support

Small retailers in Sydney’s CBD have backed plans for shared zones in the district. The state government wants to slow traffic to 10kmh and create more pedestrian thoroughfares.

King steps down

Wal King, one of Australia’s most recognisable businesspeople, is to stand down as CEO of construction firm Leighton Holdings after 23 years. He will be succeeded by co-chief operating officer David Stewart.

Overnight

In the US, the Dow Jones industrial average rose 0.7% to 10,544.13, the Australian dollar rose to 93.2c, and the Australian stock market opened to a two-month high.