westpac

Major banks’ bad debt buffers may not be as strong as they seem, with loan distress set to increase amid soaring fuel costs and rising interest rates, as three of the big four prepare to deliver interim results that could show emerging pressure on their balance sheets. That’s the view of analysts at Macquarie, who argue that changes in how banks model risk mean the provisions they hold to guard against bad debts could be up to $1 billion lower than in previous economic downturns. Follow the topics, people and companies that matter to you.