Australian banks on ‘pretty solid ground’

Market Economics’ Stephen Koukoulas says the banks are on “pretty solid ground” as the way they raise funds is based largely on deposits. The consumer watchdog announced it would hold an inquiry into the big four banks after they failed to pass on full rate cuts from the Reserve Bank of Australia. “When we approach zero interest rates, as we are in Australia and we have around the world, it’s very hard for them to maintain decent profitability but also to then pass on the rate cuts in full to mortgage holders,” he told Sky News. “I think that’s the dilemma and that’s what the inquirer will probably find."

from National | Daily Telegraph https://ift.tt/2BaXz6N