Credit Losses in Australasian Banking

Kurt Hess, Arthur Grimes and Mark Holmes ()

The Economic Record, 2009, vol. 85, issue 270, 331-343

Abstract: We analyse the determinants of bank credit losses in Australasia. Despite sizeable credit losses over the past two decades, ours is the first systematic study to do so. Analysis is based on a comprehensive dataset retrieved from original financial reports of 32 Australasian banks (1980–2005). Credit losses rise when the macro economy is weak. Asset markets, particularly the equity market, are also important. Larger banks provide more for credit losses while banks with high cost‐income‐ratios show greater loan loss provisions. Strong loan growth translates into significantly higher credit losses with a lag of 2–4 years. Finally, the results show strong evidence of income smoothing activities by banks.

Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

Downloads: (external link)
https://doi.org/10.1111/j.1475-4932.2009.00551.x

Related works:
Working Paper: Credit Losses in Australasian Banking (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:ecorec:v:85:y:2009:i:270:p:331-343

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0013-0249

Access Statistics for this article

The Economic Record is currently edited by Paul Miller, Glenn Otto and Martin Richardson

More articles in The Economic Record from The Economic Society of Australia Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().