Aussie banks to be crushed by credit card defaults

Monday 20 April 2020

Via the AFR:

Big four bank profits stand to be bushwacked by massive losses from unsecured credit to retail customers with analysis showing defaults on credit cards and personal loans could rise five times normal levels knocking an average 46 per cent off pre-crisis profits.

Evans and Partners analyst Matthew Wilson said a spike in defaults of this magnitude was consistent with previous recessions and in line with provisions made by US bank JP Morgan Chase last week.

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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.