19 Jan 2016
Stable outlook on Australia's banking sector in 2016 - Fitch Ratings
FXStreet (Bali) - Fitch Ratings has maintained a stable outlook on Australia's banking sector in 2016.
Headlines
Expect strengthened capitalisation and recently tightened underwriting standards to offset slower profit growth and modest asset-quality pressure
Profit growth likely to slow due to ongoing asset competition, higher funding costs, and a modest increase in loan-impairment charges
Australia's household debt is likely to remain high in 2016, making borrowers sensitive to increased unemployment and higher interest rates
Expect house-price growth to moderate
Economic growth is likely to benefit from stronger household spending, which could either reduce Australia's savings rate or increase household debt
Unemployment rate is expected to remain relatively stable in 2016 before modestly improving in 2017
Expects Australia's credit cycle to turn in 2016, although any weakening in asset quality should remain manageable
Expect banks to continue to strengthen their capital positions
Headlines
Expect strengthened capitalisation and recently tightened underwriting standards to offset slower profit growth and modest asset-quality pressure
Profit growth likely to slow due to ongoing asset competition, higher funding costs, and a modest increase in loan-impairment charges
Australia's household debt is likely to remain high in 2016, making borrowers sensitive to increased unemployment and higher interest rates
Expect house-price growth to moderate
Economic growth is likely to benefit from stronger household spending, which could either reduce Australia's savings rate or increase household debt
Unemployment rate is expected to remain relatively stable in 2016 before modestly improving in 2017
Expects Australia's credit cycle to turn in 2016, although any weakening in asset quality should remain manageable
Expect banks to continue to strengthen their capital positions