Clancy Yeates's questions to WESTPAC BANKING (WEBNF) leadership • Q1 2021
Question
Clancy Yeates from The Sydney Morning Herald asked for views on the financial stability risks associated with rising house prices and the potential for ultra-low interest rates to encourage riskier borrowing.
Answer
CEO Peter Francis King acknowledged the rising house prices, attributing them partly to low supply. He mitigated concerns about risky borrowing by highlighting that banks use a significant interest rate buffer (assessing serviceability around 5%) for all loan applications. He added that while regulators are monitoring the situation, a macroprudential response does not appear imminent.