Hi there Taz,Large scale residential mortgage trauma is...

Hi there Taz,

Large scale residential mortgage trauma is possible, but not probable. Even if it happened, it might impact on short term earnings, but not on capital adequacy. (APRA is currently requiring the Australian banks to run a lot of surplus capital against just such a contingency!)

While it has the resources, an Australian Government will not let an Australian bank fail. If the worst ever happens, I expect it will be a bit like Neville Shute's "On The Beach". We will be the last to go!