The announcement will always be spin. The market should know...

The announcement will always be spin. The market should know that CBA has the bargaining power and , in my opinion, CBA want to claw back more of the excess profit that HLI have made because of the property sector. Really the value is in the assets and the provisions. New business just has to cover costs and essentially the tide will turn. Right now claims are drying up but CBA are not naive - If they had a competitive advantage and could avoid managing claims they would have taken it all in house a long time ago.

Really this is a point in time not a long term view that LMI wont be needed into the future - the Government said they had a limit to the guarantee they were providing. Once that is off the table and property prices stabilize then it all goes backwards. Then someone will tell me its a straight line upwards and I will say there are a lot of old people who leave the market each year as the population ageing tops out. So at the normal property end I suspect there is a model somewhere that suggests when this all gets into balance - Really can Adelaide be the 11th most expensive housing market in the world?

Not for long as I suspect the A$ will tank after we stop mining Coal , oil and gas and we can no longer fund the NDIS and the aged pension.