Australia Commercial Banking Report Q3 2012 - New Market Report Now Available
BMI View: The recent amendment to the Banking Act in October 2011 has allowed Australian banks to raise funding through the issuance of covered bonds. While covered bonds could help lower funding costs, we see that in Australia's case, the probable decline in house prices could erase this benefit. Moreover, given that these bonds effectively downgrade the priority of other claims, the new issuances covered bonds force up the cost of later issues of unsecured debt. With plenty of room...
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