Financial Stability Department, Reserve Bank of Australia. We should like to thank Chay Fisher in particular, and also Chris Aylmer, Alexandra Baker, Craig Evans, Ingrid Linsley, and Adrian McMahon, for their helpful comments and assistance in preparing this paper.
RECENT TRENDS IN AUSTRALIAN BANKING
Article first published online: 13 APR 2010
2006 The Economic Society of Australia
Economic Papers: A journal of applied economics and policy
Volume 25, Issue S1, pages 6–25, December 2006
How to Cite
HALL, K. and VERYARD, D. (2006), RECENT TRENDS IN AUSTRALIAN BANKING. Economic Papers: A journal of applied economics and policy, 25: 6–25. doi: 10.1111/j.1759-3441.2006.tb00412.x
- Issue published online: 13 APR 2010
- Article first published online: 13 APR 2010
- Funds management
This paper discusses the performance of Australian banks over the past decade, focusing on the forces that have shaped bank strategies and outcomes. The robust Australian economy and associated demand for credit, particularly from the household sector, have been significant drivers of bank success. Intensifying competition in lending and deposits has also played a role, manifesting itself largely as price pressure, but also spurring product innovation and the easing of lending standards. While the combination of these forces has allowed bank balance sheets to grow rapidly, the sector has remained well capitalised and has low levels of non-performing assets.