NAB Hits No. 1 Position in Home Loans, Deposits

Once again four largest banks of Australia have demonstrated their dominance in home loans and deposit sectors for the month of November with National Australia Bank (NAB), hitting the number one position which saw its home lending increased by 3.99 percent. According to the latest Australian Prudential Regulation Authority monthly banking statistics, NAB was followed by two other banking giants ANZ and Westpac which posted solid growth of 2.19 percent and 2.19 percent respectively. The rate of expansion came in a month that saw a 1.65 percent acceleration in home lending where the growth rate was 1.14 percent in a month earlier. According to the Reserve Bank of Australia (RBA), the total credit that was provided to the private sector of Australia saw a slight improvement during November which is considered as an indication that small and medium-sized firms are finding it difficult to manage finance due to the tighter standards of lending which occurred because of the worldwide economic meltdown. However, the bigger firms managed to get funding through options like bond raisings and equity.

According to JPMorgan Chief Economist Stephen Walters, the overall investment in the country was improving as the larger firms; particularly the ones in the mining sector were planning to go for major expansion. However, the tighter lending standards for the smaller firms could slow down the growth of employment, he added. Mr. Walters stated that about 70 percent of the entire workforce of Australia is employed by the small and medium sized firms which might get discouraged to employ more workers in their firms if they fail to access enough funding for investments.

RBA revealed that the Private sector credit increased a seasonally adjusted 0.1 percent from October to November and 0.8 percent from the year earlier. Business sector credit dropped by as much as 1 percent in month and was down by 8.2 percent from the previous year.