Recently released market study: Australia Commercial Banking Report Q4 2010

New Financial Services market report from Business Monitor International: "Australia Commercial Banking Report Q4 2010"
 
Sept. 18, 2010 - PRLog -- In view of an anticipated slowdown in the mortgage market, we have revised our overall 2010 loan growth downwards to 3.6% from an earlier estimate of 5.8%. We expect the property sector to remain sluggish, with housing prices declining in H210 and into 2011. This leads us to lower our forecast for loan expansion in 2011 to -1.3%, down from 3.6% previously. Given that mortgage loans make up 56.4% of the total banking industry loan portfolio, Australian lenders would be badly hit by a property crash in the country.     A closer look into the key players in the sector shows that every bank in the top 10 lenders in Australia is heavily exposed to the real estate sector, with mortgage loans making up 54.7-91.3% of their loan portfolios. We believe Westpac Banking Corporation (WBC) and the Commonwealth Bank of Australia (CBA), the two largest Australian loan providers, with total gross loans and advances of AUD359.3bn (US$294.4bn) and AUD339.3bn respectively as of March 31 2010, could face the greatest downsides in the event of a debt implosion due to a sharp drop in housing prices.Note: Bubble size reflects size of loan portfolio. Source: Australian Prudential Regulation Authority, BMI WBC and CBA have grown tremendously due to accelerated lending to home buyers in 2009. These banks benefited the most from fiscal schemes designed to avert a recession in Australia, such as the First Home Owners Grant (FHOG) that provided AUD21,000 worth of grants to qualifying first-time buyers, which helped boost both housing prices and the loan books of banks. Consequently, mortgage loans now make up more than 70% of WBC and CBA's loan portfolios, exacerbating the risks that these banks face from a property market downturn. High Loan-to-Deposit Ratio Is Multiplying Risks As well as heavy mortgage loan exposure, we are also concerned about the high degree of leverage that Australian banks have taken, with the industry loan-to-deposit ratio reaching 122.1% in March 2010.     Worryingly, this ratio is considerably higher for three of the 'big four' banks: National Australia Bank (NAB) and Australia and New Zealand Banking Group (ANZ), as well as the industry leader Westpac, with a figure of 129.8%. By contrast, loan-to-deposit ratios in other banking industries in the Asia Pacific, with the exception of South Korea, have remained much lower at around 75%. Therefore, lenders in Australia face a much higher risk in the event of a r eal estate meltdown compared to their peers in other property hotspots such as Hong Kong, Singapore and Taiwan. Given our view that there will be a downturn in the property market, we expect major deleveraging occur in the Australian banking industry during the coming quarters, when a correction in property prices may prompt lenders to reduce their loan exposure in order to better manage their capital risks.

For more information or to purchase this report, go to:
-  http://www.fastmr.com/prod/83358_australia_commercial_ban...

Partial Table of Contents:

Executive Summary
- Table: Levels (AUDbn)
- Table: Levels (US$bn)
- Table: Levels At June 2010
- Table: Annual Growth Rate Projections 2010-2014 (%)
- Table: Ranking Out Of 59 Countries Reviewed In 2010
- Table: Projected Levels (AUDbn)
- Table: Projected Levels (US$bn)
SWOT Analysis
- Australia Commercial Banking SWOT
- Australia Political SWOT
- Australia Economic SWOT
- Australia Business Environment SWOT
Business Environment Outlook
- Commercial Banking Business Environment Ratings
- Table: Australia Commercial Banking Business Environment Rating
- Commercial Banking Business Environment Rating Methodology
- Table: Developed States Commercial Banking Business Environment Ratings
Global Commercial Banking Outlook
- Table: Developed States Banks' Bond Portfolios
- Table: Developed States Commercial Banking Business Environment Ratings
- Table: Comparison Of Loan/Deposit, Loan/Asset & Loan/GDP Ratios
- Table: Anticipated Developments In 2010
- Table: Comparison Of Total Assets, Client Loans & Client Deposits, 2008-2009 (US$bn)
- Table: Comparison Of Per Capita Deposits, 2010 (US$)
- Table: Interbank Rates & Bond Yields, 2009-2010
Australia Banking Sector Outlook
Economic Outlook
- Table: Australia Economic Activity, 2007-2014
Competitive Landscape
- Market Structure
- Protagonists
- Table: Protagonists In Australia's Commercial Banking Sector
- Definition Of The Commercial Banking Universe
- List Of Banks
- Table: Major Banks
- Table: Other Domestic Banks
Company Profiles
- Bendigo and Adelaide Bank
- Table: Stock Market Indicators
- Table: Balance Sheet (AUDmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Bank of Queensland
- Table: Stock Market Indicators
- Table: Balance Sheet (AUDmn, unless stated)
- Balance Sheet (US$mn, unless stated)
- Key Ratios (%)
- AMP Bank
- Table: Stock Market Indicators
- Table: Balance Sheet (AUDmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Westpac Banking Corporation
- Table: Stock Market Indicators
- Table: Balance Sheet (AUDmn, unless stated)
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Full Table of Contents is available at:
-- http://www.fastmr.com/catalog/product.aspx?productid=8335...

About Business Monitor International

Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets.  BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports.  Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including in-depth quarterly Country Forecast Reports.  View more research from Business Monitor International at http://www.fastmr.com/catalog/publishers.aspx?pubid=1010

About Fast Market Research

Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.

For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.

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Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.
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