All this talk of one of our Big4 failing is, well just sheer panic talk; they are among the most profitable and strongest capitalised in the world.
I posed the question in a post a couple of weeks ago, asking who could remember the last time a bank in Australia folded - no-one could. Forget about your building societies as they are an entirely different kettle of fish.
At the very worst, the RBA would intervene and "arrange" for any troubled bank to be merged into an another. As happened many moons ago with an Adelaide based bank.
The closest it ever came for one of the Big4 was back in the late 80's when one of them was in a spot of trouble and (it is rumoured) the RBA gave them a fixed period of time to get there house in order or they would be forced to merge.
Whether the RBA would feel obliged to go to the same extent for a foreign owned "Australian" bank, is another question.
