Digital Finance Analytics (DFA) Blog
"Intelligent Insight"
APRA today published the quarterly ADI performance statistics to September 2014. Over the year ending 30 September 2014, ADIs recorded net profit after tax of $33.5 billion. This is an increase of $3.6 billion (12.0 per cent) on the year ending 30 September 2013. As at 30 September 2014, the total assets of ADIs were … Continue reading “Banks And Their Capital”
The results are now in for the last year from the major banks, and combined they delivered more than $28bn in cash profit, higher than the $27bn last year. There are several key drivers of profitability, the first is housing lending. Rises in property prices inflates new loans, and the banks’ balance sheets. If the … Continue reading “Big Four Serve Up $28.6bn Profit”
The monthly Financial Aggregates from the RBA for August are out, and shows yet another growth in housing lending. Total housing credit grew at an annual 6.7%, business credit at 3.2% and personal credit 1.1%. Total housing was $1.39 trillion, and now represents 60.7% of all bank lending, the highest it has ever been. In … Continue reading “Total Housing Lending Hits Another High At $1.39 Trillion – RBA”
APRA published their monthly banking statistics for August 2014 today. The trend remains set, with investment lending running ahead of owner occupied lending. Further evidence that the RBA should react to the hot market. Total lending was up by $7.4 billion to a total of $1.28 trillion. Owner Occupied loans grew at 0.48% from last … Continue reading “Deja Vu Housing Data For August From APRA”
In an important speech given today by Wayne Byres, Chairman of APRA, “Perspectives on the Global Regulatory Agenda”, there are some important pointers which indicate to me that we should expect some changes to the capital regulatory framework quite soon. We highlighted the capital questions recently. Whilst talking about the global agenda, he did confirm … Continue reading “Capital Rules Likely To Be Sharpened”
A cornerstone of banking regulation and control is the application of capital ratios, which acts a brake on their ability to write more loans. The rules are set by the Bank of International Settlement, but they may be interpreted by local regulators, like APRA in Australia to take account of local conditions. BIS has no … Continue reading “The Capital Conundrum”
The latest report, volume 20 of the Mortgage Industry Report series was released today. As well as over viewing current industry trends, this time we focus on some of the mortgage pricing issues in the light of the FSI interim report, capital and funding. JPM authored their report using DFA research data as detailed in … Continue reading “Latest DFA/JP Morgan Mortgage Industry Report Launched Today”
We know that first time buyers are sitting on the sidelines, as shown in our recent surveys. The biggest barrier is price. Many are desperate to enter the market and would jump at any additional incentive. No surprise then to see proposals popping up from time to time to try and assist first time buyers. … Continue reading “Why Enticing First Time Buyers With Super Is A Bad Idea”
The wind appears to be changing. First the new head of APRA warned at a CEDA event they were watching the mortgage lending of the banks closely, “The Australian banking system clearly has a concentration of risk in housing. If anything was to go wrong in the housing market it would have very severe impact … Continue reading “If The Worm Turns, What Happens To Household Mortgage Stress?”
Some time back we reported on the results of our household surveys, looking especially at the loan to income (LTI) data. This was prompted by the Bank of England’s move to limit banks abilities there to lend higher LTI loans. At the time we showed that at an aggregate level, LTI’s in Australia were higher … Continue reading “The Loan To Income Mess”