CBA warns of rate hike

CBA warns of rate hike

11 February 2010 by Staff Reporter 0 comments

Despite posting a $2.9 billion interim cash profit, CBA’s chief executive Ralph Norris said the bank could be forced to lift rates above the Reserve Bank due to increased funding costs.

Mr Norris said funding costs and their pass-through was a “day by day situation”, noting that higher cost inputs would need to be passed on.

According to a report in The Australian Financial Review, Mr Norris said higher funding costs would also crimp profits.

He also said adopting excessive regulatory measures to align with international reforms would hurt the industry and lead to higher costs for borrowers.

“We must be careful that Australia, which has  a healthy banking system and an effective and well managed regulatory regime, is not materially disadvantaged by changes driven by poor practices in the northern hemisphere,” he said, adding: “not one dollar of taxpayer money has gone to our banks”.

 

Despite posting a $2.9 billion interim cash profit, CBA’s chief executive Ralph Norris said the bank could be forced to lift rates above the Reserve Bank due to increased funding costs.

Mr Norris said funding costs and their pass-through was a “day by day situation”, noting that higher cost inputs would need to be passed on.

According to a report in The Australian Financial Review, Mr Norris said higher funding costs would also crimp profits.

He also said adopting excessive regulatory measures to align with international reforms would hurt the industry and lead to higher costs for borrowers.

“We must be careful that Australia, which has  a healthy banking system and an effective and well managed regulatory regime, is not materially disadvantaged by changes driven by poor practices in the northern hemisphere,” he said, adding: “not one dollar of taxpayer money has gone to our banks”.

 

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