They have $13.5B worth of lans outstanding
They now get the money from 2 sources-
1.rmbs -
2. Warehouse facilities
They pay each of these sources a rate as per whatver reference point is contracturally agreed (eg BBSW + MARGIN)
rhg then charge customers a rate. So for eg their standard variable home loan is 9.22% currently
the spread (diffeence) is their profit
Comparing say NAB rate of 8.98% and the new RAMS rate (now owned by Westpac) at 8.9% , RHG are expensive but this is fine as they are not trying to win new business just make profit from existing customers.
So when results released we need to see what they say about whether their spread is safe or not
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