Banks solid but not outperforming
Australia's banks may be performing relatively well, but they have not been immune from global funding markets, structural change or new regulatory demands, according to the latest analysis issued by KPMG.
KPMG's Major Australian Banks Half Year 2012 report confirmed that the big Australian banks had all posted a healthy profit for the 2011-12 half year, but added that lack of growth would be the focus for investors.
It said the majors' cash profit was, after tax, $12.6 billion for the six months -up 2.4 per cent from the second half of last year's cash profit of $12.3 billion.
Commenting on the report, KPMG head of banking, Andrew Dickinson said the major banks' profit clearly showed Australia had a strong banking system.
"However, it must be viewed in light of the increased capital that the banks now need to hold," he said.
Dickinson said return on equity had remained around 16 per cent for most banks, and shareholders would need to accept this level of return is all they could expect for the foreseeable future.
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