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Good morning.

Bank of America has followed rivals in scrapping a 2008 decision that capped the bonuses of its top bankers and traders in London at 2x base salary. The banks’ UK ‘material risk takers’ can now earn up to 10x their base salary, in keeping with policies at JP Morgan and Barclays.

Despite seeming like a fairly eye-watering quantum, banks are sure to get their pound of flesh. The WSJ reports that some junior bankers in boutique investment bank Robert W. Baird’s industrials team have been regularly clocking in 110 hour weeks. Despite being a mid-bucket firm priding itself on its “No A**hole Rule,” one wonders how bosses that overrule protected Saturdays can honestly live up to that mantra.  

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Market movers

PEXA shares soared Wednesday, leading the ASX 200 after UK regulators approved its new property product.

The quick sync

• As Chris Jewell writes, political inertia is stalling fintech reform — and Australia’s hard-won gains risk shifting offshore. (Capital Brief)

• Andrew Charlton’s crypto pivot positions him as Labor’s top pick for financial services – if he can hold onto Parramatta. (Capital Brief)

• Vu Tran’s Black Sky Industries is betting on startup innovation to reduce Australia’s $55b defence dependence on US giants like Northrop and L3Harris. (Capital Brief)

• A regional bank levy remains on the table after Treasury requested detailed cost data, signalling the Albanese government may revisit the policy if re-elected. (AFR)

Trading floor

M&A

• Man Group believes Japan’s auto sector will face mergers as firms like Toyota, Nissan, and Honda seek scale to compete with aggressive Chinese rivals and rising trade hurdles. (Bloomberg)

• Swoop Aero’s dramatic decline saw it sell for $1m after internal issues and delays, with its assets forming the basis of Kite Aero (Capital Brief)

• Google CEO Sundar Pichai told a court he hopes to finalize a deal this year to bring Gemini AI to iPhones, adding it as an option alongside ChatGPT in Apple’s ecosystem. (Bloomberg)

• Bega Cheese is holding firm on its brand rights in Fonterra’s $2b+ Mainland sale, limiting rival access and betting it will emerge as the top bidder despite tension over access to key deal data. (The Australian)

Capital Markets

• Perseus Mining maintains FY guidance despite Q3 gold production and sales falling. (Capital Brief)

• Expert360, co-founded by Bridget Loudon, is seeking $25m to fund an acquisition expected to increase earnings to $26m. (AFR)

• Westpac warns of $140m hit to H1 profit from hedge losses. (Capital Brief)

• Prada beat luxury industry trends with strong Q1 sales, led by Miu Miu’s 60% growth, and is buying Versace to boost its competitive edge. (Bloomberg)

• Attalis Capital attracted a $250m investment from the Victorian Business Growth Fund for its acquisition of Kinder Australia. (AFR)

• Coles posted a 3.4% rise in Q3 sales to $10.4b, aided by automation rollout. (Capital Brief)

• Aeris Resources is raising $70m in equity, with Bell Potter Securities managing the deal. (AFR)

• Stockland has reaffirmed its full-year guidance, supported by progress on its $3b Waterloo housing project in Sydney. (Capital Brief)

• Spark New Zealand seeks a co-investor for its $1.1b data centre portfolio. (AFR)

• Origin’s LNG revenue and volumes drop on prices, cyclone; UK customer base grows. (Capital Brief)

• Geminder's Pact Group delisting plan faces resistance from minority shareholders, including activist investor Jeremy Raper. (AFR)

• As more companies shift their primary listings overseas, investors worry about the decreasing presence of Australian shares on the ASX. (AFR)

• BP to supply gas to Woodside’s Louisiana LNG project, boosting long-term plans. (Capital Brief)

• Mercedes and Stellantis scrapped their 2025 outlooks as Trump’s shifting tariffs create supply chain chaos and pricing uncertainty across the auto sector. (Bloomberg)

• Pet Circle's losses rose to $26.4m despite reaching $400m in sales. (AFR)

• Star Entertainment posted a $21m quarterly loss and is pushing ahead with a $300m investment deal with Bally's. (Capital Brief)

• Vinarchy, formed after Accolade's merger with Pernod Ricard, will scrap several brands to prioritize major wine labels. (AFR)

• Morgan Stanley Australia swung to a $7.7m profit in 2024, rebounding from losses and eyeing a strong 2025 pipeline led by private equity sales. (The Australian)

• Australia's CPI rose 0.9% in the March quarter and 2.4% annually, slightly above forecasts, driven by higher housing, education, and food costs. (Capital Brief)

• China's factory activity fell to its lowest in 16 months in April, impacted by new US tariffs. (Capital Brief)

• China is notifying firms about US product exemptions from tariffs, with some industries already seeing relief. (Capital Brief)

• The Euro zone's strong Q1 growth is expected to slow as US tariffs impact the economy. (Capital Brief)

• Aldi’s Australian profit surged to $402m in 2023, driven by strong sales growth to $12.1b. (AFR)

• Major app makers are forming a coalition to push for new laws and support antitrust action against Apple and Google over age checks and unfair app store rules. (Bloomberg)

• Nvidia CEO Jensen Huang is calling on Donald Trump to ease AI chip export restrictions to help U.S. companies better compete globally. (Bloomberg)

• Australian home prices set a new record in April, rising 0.3%, despite lower sales and listings. (Capital Brief)

• Investors warn the bond market is too bullish on rapid RBA rate cuts despite inflation easing into target. (AFR)

• ATO’s crackdown on decades-old family trust tax errors risks financial collapse for wealthy Australians. (AFR)

• Australia’s main betting regulator quietly scrapped tougher gambling rules, handing a win to giants like Bet365 and Sportsbet as losses soar and oversight lags. (Bloomberg)

• Meta beats Q1 forecasts and lifts AI spending outlook to as much as US$72b despite regulatory headwinds. (Capital Brief)(Meta)(CNBC)

  Microsoft tops earnings forecasts as Azure surges 33%, easing AI demand fears. (Capital Brief)(Microsoft)(Reuters)

VC

• The 10th annual Sunrise festival in Sydney highlights the growth of Australia's startup ecosystem, from small beginnings to global reach. (Capital Brief)

• Mighty Partners, backed by Larry Diamond, targets $100 million loan book growth in two years. (AFR)

• Australia’s VC firms are vying for a share in Thinking Machines Lab, an AI startup valued at $15b, aiming for a historic $2b raise. (AFR)

• Womby, a new AI startup in Australia, helps consumers navigate the complex financial complaint system. (Smart Company)

People moves

• Cbus Super has promoted Leigh Gavin to chief investment officer, targeting $150b in assets by 2030. (Capital Brief)

• DigiCo REIT shares climbed after Mark Arbib stepped down from the board to become CEO of the AOC. (Capital Brief)

• Andrew Charlton is being considered for a prominent role in the next Labor government, potentially replacing Stephen Jones as financial services minister, with a shift in crypto policy. (Capital Brief)

The watercooler