Blog
Blog
Blog
Blog
14 Jan, 2021 Author Ranina SanglapRehan Ahmad
Major Australian banks face a tougher year in 2021, as their scaled-down operations following a spate of misconduct cases has left them with less cushion against high compliance costs, record low interest rates, elevated loan loss provisions and competition from nonbanks, analysts say.
Australia and New Zealand Banking Group Ltd., Commonwealth Bank of Australia, National Australia Bank Ltd. and Westpac Banking Corp. have sold or are off-loading their wealth management and insurance businesses since the Royal Commission exposed their misconduct and violations of consumer rights in February 2019.
As their revenue sources are now primarily corporate and mortgage lending in Australia and New Zealand, the banks no longer enjoy the benefits of risk diversification and fee growth they used to have during the few strong years prior to 2019. As COVID-19 continues to rage, th
 Credit card customers are getting dudded by high interest rates on cards that have barely budged during the pandemic. A new analysis by financial services firm Canstar shows in 2020 there were just 15 cuts to personal credit card rates and the average card rate fell by a tiny 0.03 per cent. This is despite the Reserve Bank of Australia s official cash rate falling from 0.75 per cent to a record low of 0.1 per cent during the year. The average credit card interest rate is now 16.91 per cent, and consumers appear to be voting with their feet. RBA data released Tuesday shows the amount of credit card debt accruing interest is near its lowest level since 2004 but it rose slightly in November to $19.96 billion, partly driven by the Black Friday sales.