Oz banks do not have the balance sheet problems of many other OECD banks so no nationalising here.
Near zero interest rates and enormous amount of printed paper being thrown at the world economy so a deflation crash of Oz realestate market is not a given.
Fat margins mandated by Government funding support at the short end of the curve and no competition together with outrageous fee gouging means Oz banks will continue to make staggering profits each and every year into the future.
Ah, sorry the bad debts you speak of. The bad debt provisions and some write offs will weaken the balance sheet slightly and may require some more capital raisings. It doesn't change the fact the underlying business for each of our big 4 throws off many billions of free cash annually. Unless bad debts are catastrophic, which I don't believe will be the case in Oz, the market will look forward to strong profits and forget about the sunk cost of historic bad loans.
The game IMHO is to not jump too early until the bad debt headlines have peaked and then the invetsment industry will run the banks up hard. With the wall of liquidity hitting the country I think the severity of the credit crunch will cause bad loans to max out soon because ATM any weakness is seeing companies go to the wall. Survive this year and with ultra low rates you probably wont be going under. Banks are on the nose now but it won't take much to get the cheer squad behind them again.
In a zero interest rate world you wanna put your money in bank shares not banks I reccon.
