Banks have grounds to raise home loan rates: Deloitte
Posted
A major accounting firm says the big banks have a case for raising home loan interest rates beyond any increase in official rates.
Deloitte has released an annual report on the Australian mortgage market and suggests it remains resilient, despite the shake-out on global credit markets.
Last week Federal Treasurer Peter Costello again insisted that the banks had no grounds to lift home loan rates for existing customers on the basis of what was occurring in the US sub-prime mortgage market.
But Deloitte spokesman Graham Mott disagrees.
"My response to that is, I think there is a legitimate case to pass funding costs on if the banks are keen to retain their margins," he said.
"They are looking at it differently in terms of competitive opportunity in relation to market share, versus their non-bank competitors.
"From a pure margin retention perspective, banks' funding costs will have also increased."
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