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Australian Bks Warn On Escalating Loan Losses

Discussion in 'Finance & Banking' started by Tropo, 18th Dec, 2008.

  1. Tropo

    Tropo Well-Known Member

    17th Aug, 2005
    Australian Bks Warn On Escalating Loan Losses

    MELBOURNE (Dow Jones)--More of Australia's major banks warned Thursday that bad loans will rise and loan growth is likely to slow as the impact of the global financial crisis hits home.
    Australia and New Zealand Banking Group Ltd. (ANZ) and National Australia Bank Ltd. (NAB) joined Commonwealth Bank of Australia (CBA.AU) in warning of deteriorating market conditions, echoing comments made by the nation's biggest bank by market capitalization, Westpac Banking Corp. (WBK), earlier this month.
    Shares in Australian banks have tumbled in recent months as each has confessed to rising loan losses resulting from exposure to collapsed corporates, including Allco Finance Group Ltd. and ABC Learning Centres Ltd., and a marked slowdown in economic growth.
    All of the nation's big banks have also tapped local investors in recent weeks to bolster their capital positions as they brace for higher loan losses and defaults - some raisings attracting more attention than others.
    In a week it would likely rather forget, CBA said its full year loan impairments are likely to jump to A$2.5 billion for the year to June 30, 2009, or around 60 basis points of loans, surprising investors with the speed of the deterioration.