Royal Commission findings to deepen credit crunch

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As the Hayne Royal Commission prepares its interim report, the panic is growing. Citi expects Hayne to expose “systemic over-lending”:

In our view the most material conclusion of the commission is likely to be that the lending process presently isn’t sufficiently responsible. Responses to this issue are likely to involve increased due diligence which will impact the growth and availability of credit further to existing measures.

[Bank systems] have allowed them to lend too much…This is visible across the system, with issues in mortgage broking all the way through to expense verification.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.