Taking time on rates worth $12m - every day
Wed May 2, 2012 2:19pm
A spokesman for ANZ said profits in Australia fell 7 per cent in the half, but rose 1 per cent over the year. However, including overseas activities, ANZ's profits rose 8 per cent for the half or 10 per cent for the year.
Australian Bankers’ Association chief Steven Munchenberg referred to the RBA’s statement yesterday, which noted that funding costs are higher.
‘‘At the margin, wholesale funding costs have declined over recent months, though they remain higher, relative to benchmark rates, than in mid-2011,’’ the RBA said.
Mr Munchenberg also said the expansion of Australian banks overseas would not increase the risks borne by the Australian public because of robust regulation by APRA.
The Australia Institute director Richard Denniss said bank profitability could only be attributable to the big four’s market power.
‘‘In the retail sector when people do less shopping, we expect their profits to fall,’’ he said. ‘‘In the banking system, we’re told if people are going to borrow less money off them, their profits should rise.’’
The RBA cut the cash rate to 3.75 per cent from 4.25 per cent yesterday, flagging the slowdown in the domestic sector. To date, only debt stressed Bank of Queensland has cut rates, reducing its standard variable rate by 35 basis points to 7.11 per cent.
Currently the standard variable rate at ANZ is 7.42 per cent. At Commonwealth Bank, a similar loan is 7.41 per cent. At National Australia Bank it's 7.31 per cent, while at Westpac a standard variable rate goes for 7.46 per cent, according to Canstar.
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