NAB, Commbank, ANZ, Westpac: Top Australian Banks Most Profitable Among World Industry Peers
An independent comparison of banks in developed countries shows four of Australia's big banks generating big profits than other banks. National Australia Bank, Commonwealth Bank, ANZ and Westpac are hailed most profitable banks in the developed world.
The annual report is released by the Bank for International Settlements (BIS) which is also the central bank of all the central banks in the world. The report is favorable for Australian banks since results show they did well against international competitors.
The four Australian banks have the highest profits before tax since 2008. Their profitability was partly due to having the highest interest margins over other banks in developed nations. Last 2012, Australia's banks once again have a high profit margin of 10% over Canadian banks. The BIS report shows banks in Canada having the second highest profit margin.
Only banks in Spain and US have higher profit margins than Australian banks. Although the banking industry receives complaints due to high cost of business, operating costs for the Australian banking are still lower compared to banks in Britain, Canada, Italy, Germany, Spain and US.
The BIS is among the few institutions to remind banks about the threat of a sub-prime mortgage system in the middle of a global financial crisis. The global institution expressed its concern about finances of the world's central banks.
The report also reveals some central banks have printed more money to boost their respective economies. This action protected the global economy from suffering more setbacks. However, these banks were not given the responsibility of improving household finances, fix budgets or establish economic reforms.
The BIS report recommends that authorities should implement product and labour market reforms sooner rather than later so economic resources can be quickly transferred to high-performing sectors.
Governments, businesses and households were involved in taking care of bottom lines. Governments around the world had to double their efforts to sustain economies.
