(Repeat for additional subscribers)
July 16 (The following statement was released by the rating agency)
Fitch states in its APAC Chart of the Month report that
Australian bank funding and liquidity improvements are likely to continue,
albeit at a reduced pace. However, a sharp increase in demand for credit may
pressure the ability of banks to fund the growth without potentially reversing
some of the recent gains.
Banks have largely addressed the capital and liquidity coverage ratio
requirements of Basel III following significant strengthening post-2008. An
increase in deposit gathering and lengthening of wholesale funding duration
drove stable funding (customer deposits + long-term wholesale funding) to 75% of
total funding at end-March 2014, up from 62% in 2008.
Further funding improvements are likely to be more nuanced, with a greater
emphasis on longer-term funding rather than deposits, while any additional
capital requirements are likely to be achieved through retained earnings.
Link to Fitch Ratings' Report: APAC Banks: Chart of the Month - July 2014