Funding guarantee big earner for government
By
Tim Neary
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9/02/2010 12:00:00 AM
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The federal government has admitted its guarantee on wholesale funding has been a formidable earner for it coming out of the GFC, saying the state will reap $5.5 billion from banks for the (soon to be expired) cover.
The admission also puts to rest the misnomer that banks got bailed out for free, according to a report in the AFR.
The Big Four - all rated AA - have already shelled out $1.1 billion in fees to borrow the state's superior AAA credit rating.
Banks have been the recipients of the government's generosity; from the central bank's expansion of the repurchase facility for undesirable securities to the first-home owners grant.
Related Story
Govt withdraws bank guarantee - The Rudd government is withdrawing the guarantee scheme for large deposits and wholesale funding on the 31 March.
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