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Australia’s experience in the subprime crisis

John Edwards Chief Adviser -Financial Markets, Macroeconomic Group. Australia’s experience in the subprime crisis. International credit spreads - correlations. Source: Reuters. Spread to risk-free rate: Australian corporations. Source: Reserve Bank of Australia.

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Australia’s experience in the subprime crisis

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  1. John Edwards Chief Adviser -Financial Markets, Macroeconomic Group Australia’s experience in the subprime crisis

  2. International credit spreads - correlations Source: Reuters

  3. Spread to risk-free rate: Australian corporations Source: Reserve Bank of Australia

  4. International stock indices - correlations Source: Reuters.

  5. Securitised mortgages Source: Reserve Bank of Australia

  6. Australian banks’ offshore borrowing Source: Reserve Bank of Australia

  7. RBA balance sheet Source: Reserve Bank of Australia

  8. Banks’ liabilities: deposits Source: DX

  9. Australian banks’ offshore bond issuance($A equivalent, quarterly) Source: Reserve Bank of Australia

  10. Term funding costs Source: Reuters

  11. Credit market spreads - Australia • 5-7 September 2007: • RBA injects $A 2.8b into financial system to provide liquidity. • ECB lends emergency cash to banks (42.2b euros). • 10-17 December 2007: • Tighter credit conditions constrain several buyouts and acquisitions. • Centro property group warns that it is facing trouble re-financing $A 1.3b of debt, due to the subprime crisis. • 18 February – 12 March 2008: • ANZ reveals that its earnings are likely to be hurt from the fallout of the credit crisis. • Allco Finance Group Ltd. announces it will sell $A 2.1b of assets, after running into funding difficulties. • MFS Ltd.’s largest fund suspends interest payments, and seeks funding support. Source: Reuters

  12. Internationalisation of Australian business Source: Reserve Bank of Australia

  13. Australia’s external position Source: Reserve Bank of Australia

  14. Household debt to disposable income Source: Reserve Bank of Australia and Bloomberg

  15. Household debt and house price growth Source: Reserve Bank of Australia

  16. Credit growth Source: Reserve Bank of Australia

  17. House prices to income Source: Reserve Bank of Australia

  18. Business borrowing Source: Reserve Bank of Australia

  19. Household saving, consumption and debt Source: Reserve Bank of Australia

  20. Employment, income and wealth Source: Reserve Bank of Australia

  21. Residential loan defaults: Australia vs. USA Australia Australia USA Source: Standard and Poor’s

  22. International banks’ return on equity Source: International Monetary Fund

  23. International banks’ provisions to non-performing loans Source: International Monetary Fund

  24. International banks’ capital to assets *Tier 1 capital Source: International Monetary Fund

  25. Australian dollar volatility Source: Reuters

  26. Indicators of confidence in the economy Source: Reserve Bank of Australia

  27. Equity price movements Source: Reuters

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