RBA says Banks to face slower growth

Australian banks will weather the financial damage from natural disasters that struck the nation this year and face a period of slower growth as borrowers show restraint, the central bank said in a twice-yearly report.

While the floods and cyclone in Queensland state “could impinge on banks’ asset quality to some extent,” the impact should be limited given the affected regions account for a small share of total lending, the Reserve Bank of Australia said in its financial stability review released today in Sydney.

“Banks’ domestic growth opportunities are likely to be more limited in the future” as the expansion prior to the global financial crisis was partly fueled by financial deregulation and a shift to low inflation, the RBA said. “It appears unlikely that credit growth will return to very high rates that were sustained in the pre-crisis period.”


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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell