By
At the launch of the 100 Women of Influence awards, Kelly told an Australian Financial Review reporter that banks’ own funding costs are rising.
“Funding costs had been on a lovely decline earlier in the year and you could see that actually coming through; the funding costs were lower than they’d been a year ago and two years ago and three years ago. Right at the moment, they’ve picked up again. In fact, people are not out there raising money through off-shore wholesale funding opportunities.”
“Unfortunately, it’s still a pretty volatile world out there and I guess we shouldn’t be surprised – the GFC is enormous in its impact. Any financial crisis has a long-run impact. We’ve probably got a few more years of real volatility to weather.”
Kelly says credit demand is also ‘very low’.
“I recall the decade before the GFC…overall credit growth was about 12.6%. That’s three times GDP growth. Credit growth in the last couple of years has been 3%. It’s not going to go back up to those sorts of levels, it’s going to remain at around GDP level.”
