Australia is only two years away from experiencing a surge in refinancing activity, financial experts predict.

The Australian reports Credit Suisse's head of leveraged finance for Asia Pacific, Michael Tierney said "There's a huge amount of cash sitting on the sidelines and chasing yield."

"The inflows to the sector are enormous and there is an issue in Australia coming up where we have a refinancing wall of $18 billion in loans (maturing) in 2012 and 2013."

Mr Tierney, who was at a private equity conference yesterday, said the experience in the US was a good sign that this refinancing is likely to boost demand for high-yield bonds, the newspaper reports.

Mr Tierney described the refinancing of bank debt and leveraged loans in the US market as a 2009-10 story, saying there's been $US88bn ($92.8bn) of loans refinanced from the issue of high-yield bonds in 2010 alone, "so there is an amazing amount of cash to invest in this space."

The Australian reports Archer Capital director Peter Wiggs said these sort of events came in cycles.

"What you've seen in the last 12 months is banks coming back to the leverage game."

"I think that will continue when the big refinances are due and then it's likely to shrink again," Mr Wiggs said.