I've just come off the results call with CBA. They pulled out of...

I've just come off the results call with CBA. They pulled out of purchasing ABM Amro and basically blamed the Melbourne banks (ANZ, NAB) for having to do so. They said that because of the recent negative announcements by these two, Australian banks ability to secure international funding was impacted which made the acquisition of ABN Amro uneconomic. Bloody Melbourne banks.

Anyway, there was no direct mention of Centro or any other big name but I have to say the CBA 'aint too worried about their loan provisioning. Although it's unclear exactly how much CBA have lent to Centro, there are no huge provisions in the last year against "un-named property companies" or the like. CBA are an influential player in Centro as demonstrated a) by their holding b) by the involvement in the refinancing earlier in the year.

As an aside, I still reckon ANZ have made a provision against their Centro debt because they know that in 6-12 months, when Centro is back to health, they can write the amount back to P&L and make their numbers look better.

St.George weren't too concerned yesterday. Westpac said on Friday that their 'names' were on a resolution path and had actually improved, not deteriorated, over the past 2-3 months and Centro didn't even get a mention by CBA today. Why? The answer of course is that Centro, after nearly nine months since their problems started, are still earning good income on a quality property portfolio and easily covering the loan repayments.