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Australian banks defer payments on A$200b of loans

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Australia's banks have deferred payments on at least A$200 billion (S$185 billion) in loans as an economic shutdown to fight the novel coronavirus throws hundreds of thousands out of work and cripples household incomes

[SYDNEY] Australia's banks have deferred payments on at least A$200 billion (S$185 billion) in loans as an economic shutdown to fight the novel coronavirus throws hundreds of thousands out of work and cripples household incomes.

The Australian Banking Association on Friday said 100,000 loans had been deferred just in the last week, half of them mortgages, bringing total deferrals to 643,000.

"The surge in demand for assistance from banks shows that the economic impacts continue to be felt, and by no means is the nation through this crisis," ABA CEO Anna Bligh said.

Data out earlier in the week showed almost a million jobs had been lost since much of the economy went into lockdown in the middle of March.

Most of the major banks have sharply lifted their loss provisions in case of defaults, deferred or cut their dividends and raised fresh capital to tide them through the crisis.

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Later Friday, the Reserve Bank of Australia (RBA) is expected to forecast economic output will dive by 10 per cent in the first half of the year, with unemployment almost doubling to around 10 per cent.

REUTERS

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