RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

SLUGGED: Home loans double in 10 years

Australians have felt the impacts of rising property prices on their repayments. Source: Supplied

AVERAGE mortgage repayments have leapt by 105 per cent over the past decade but wage increases have failed to keep up.

Australians are putting much larger chunks of their budgets towards meeting their home loan costs than they were 10 years ago - some states have seen repayments climb by up to 152 per cent.

Wages rose by 54.5 per cent and inflation has climbed by 31.4 per cent.

Australian Bureau of Statistics data and figures compiled by financial services company Canstar compared average home loans over 25 years, based on the average interest of today's big four banks at 6.42 per cent.

In NSW the average loan size in 2002 was $212,400 but has risen to $341,800 resulting in the average monthly repayment increasing by 61 per cent to $2295.

In Victoria the average loan rose from $175,900 to $306,500 and repayments increased by 74 per cent to $2058.

In Queensland the loan size rose from $152,700 to $289,900 and the average repayments climbed by 90 per cent to $1946.

In South Australia loans rose from $124,900 to $249,400 and repayments increased by 100 per cent to $1674.

In Western Australia the average loan rose from $141,000 to $302,500 and repayments increased by 115 per cent to $2031.

In Tasmania the average loan rose from $94,800 to $218,100 and repayments increased by 130 per cent to $1464.

In the Northern Territory the average loan increased from $133,500 to $337,000 and repayments increased by 152 per cent to $2262.

In the ACT the average loan rose by $160,500 to $350,700 and repayments increased by 119 per cent to $2354.

Canstar analyst Mitchell Watson said Australians had felt the impacts of rising property prices on their repayments.

''Housing prices have increased and we've seen a direct impact on the amount which people need to borrow to purchase those homes which in turn has dramatically increased their loan repayments,'' he said.

''People need to be savvy both in their property choice, ensuring they are sticking to a property within their means.

''Wages haven't increased as much as property prices have which means a property you may have purchased back in 2002 may be out of your reach.''

NT experienced the biggest spike in loan monthly repayment sizes rising from $896 to $1366 (152 per cent) over 10 years, followed by Tasmania (130 per cent), ACT (119 per cent), WA (115 per cent), SA (100 per cent), Qld (90 per cent), Vic (74 per cent) and NSW (61 per cent).

AMP chief economist Dr Shane Oliver said the nation's rapid accumulation of debt has resulted in households spending more on mortgage repayments.

''Australians have taken on more debt and that has been in order to pay more for houses and they've ended up with bigger mortgages than we did in 2002,'' he said.

''The household sector has found various ways to deal with that partly by squeezing down on other areas and also working longer hours.''

Mortgage Choice spokeswoman Belinda Williamson said it was crucial mortgage holders made sure they were comfortable with their regular home loan repayments.

''Current and potential mortgage holders, who want to ensure they continue to meet and feel comfortable with their home loan repayments, should be realistic about their level of borrowings and regularly review their repayment strategy,'' she said. 

View the original article here

SLUGGED: Home loans double in 10 years

Australians have felt the impacts of rising property prices on their repayments. Source: Supplied

AVERAGE mortgage repayments have leapt by 105 per cent over the past decade but wage increases have failed to keep up.

Australians are putting much larger chunks of their budgets towards meeting their home loan costs than they were 10 years ago - some states have seen repayments climb by up to 152 per cent.

Wages rose by 54.5 per cent and inflation has climbed by 31.4 per cent.

Australian Bureau of Statistics data and figures compiled by financial services company Canstar compared average home loans over 25 years, based on the average interest of today's big four banks at 6.42 per cent.

In NSW the average loan size in 2002 was $212,400 but has risen to $341,800 resulting in the average monthly repayment increasing by 61 per cent to $2295.

In Victoria the average loan rose from $175,900 to $306,500 and repayments increased by 74 per cent to $2058.

In Queensland the loan size rose from $152,700 to $289,900 and the average repayments climbed by 90 per cent to $1946.

In South Australia loans rose from $124,900 to $249,400 and repayments increased by 100 per cent to $1674.

In Western Australia the average loan rose from $141,000 to $302,500 and repayments increased by 115 per cent to $2031.

In Tasmania the average loan rose from $94,800 to $218,100 and repayments increased by 130 per cent to $1464.

In the Northern Territory the average loan increased from $133,500 to $337,000 and repayments increased by 152 per cent to $2262.

In the ACT the average loan rose by $160,500 to $350,700 and repayments increased by 119 per cent to $2354.

Canstar analyst Mitchell Watson said Australians had felt the impacts of rising property prices on their repayments.

''Housing prices have increased and we've seen a direct impact on the amount which people need to borrow to purchase those homes which in turn has dramatically increased their loan repayments,'' he said.

''People need to be savvy both in their property choice, ensuring they are sticking to a property within their means.

''Wages haven't increased as much as property prices have which means a property you may have purchased back in 2002 may be out of your reach.''

NT experienced the biggest spike in loan monthly repayment sizes rising from $896 to $1366 (152 per cent) over 10 years, followed by Tasmania (130 per cent), ACT (119 per cent), WA (115 per cent), SA (100 per cent), Qld (90 per cent), Vic (74 per cent) and NSW (61 per cent).

AMP chief economist Dr Shane Oliver said the nation's rapid accumulation of debt has resulted in households spending more on mortgage repayments.

''Australians have taken on more debt and that has been in order to pay more for houses and they've ended up with bigger mortgages than we did in 2002,'' he said.

''The household sector has found various ways to deal with that partly by squeezing down on other areas and also working longer hours.''

Mortgage Choice spokeswoman Belinda Williamson said it was crucial mortgage holders made sure they were comfortable with their regular home loan repayments.

''Current and potential mortgage holders, who want to ensure they continue to meet and feel comfortable with their home loan repayments, should be realistic about their level of borrowings and regularly review their repayment strategy,'' she said. 

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here

RBA tells homeowners to resist loans

RBA tells homeowners to save and not take on attractive home loans. Source: Supplied

HOUSEHOLDS are being urged to continue bolstering their saving and resist the attractive loans on offer from the major commercial banks by the Reserve Bank, as the economy works its way out of its historically high debt levels.

Despite financial stress and mortgage arrears falling in most parts of the country, the RBA said the household savings rate of just over 10 per cent, which is well above its 20-year average, must be maintained and debts paid down.

And the central bank's half-yearly Financial Stability Review warns investors the upward swing in global markets this year may only be temporary with the crisis in Cyprus a clear warning of the risks that still remain as the global economy works its way out of its financial hangover.

The RBA's increasingly optimistic outlook has seen JP Morgan yesterday push back its tip of another and final interest rate cut, to take the official cash rate to a record low of 2.75 per cent, from May to November.

This comes as the RBA confirms the cost of wholesale funding - the level at which banks borrow from each other - has dropped to its lowest level since the GFC began in 2008.

But instead of using this drop to lower borrowing costs for consumers, the banks have continued to strengthen their capital, funding and liquidity positions.

The Financial Stability Review also said that while ANZ accounted for a large part of the growth in Asia with its super regional strategy to generate 25-30 per cent of its business from the region by 2017 - all the big banks have increased their exposure in the past five years.

International Banking Statistics shows Australian banks assets in Asia has risen from $27 billion in 2007 to $112 billion at the end of last year.

But the report warned that while the more prudent approach of the post global financial crisis period has helped bring household debt-to-income ratio down from 153 per cent in late 2006 to 148 per cent it was still to high and paying down debt must continue to be priority.

The US rate peaked at 133 per cent during the sub-prime boom.This more cash-conscious approach has however seen household's mortgage buffer surge to over 20 months - this is scheduled repayment plus interest - in the past five years.

"Housing loan arrears rates have continued to improve across most parts of the country and other indicators of household financial stress remain low," the RBA report said.

"Nonetheless, household indebtedness and gearing remain around historically high levels. It would therefore be undesirable from a financial stability perspective if households were to exhibit less prudent behaviour than they have over the past few years.

"This increasingly conservative approach to family finances has seen the net worth of the average household rise to $721,000 - this includes property assets, superannuation and savings in the March quarter.

It is back from a low of $632,000 in mid-2008 but still below its 2007 peak of $772,000 before the crisis hit.

View the original article here