Healthy profits in the banking and general insurance sector are fuelling growth in Australia according to the bi-annual publication by the RBA.
Lending and credit data is also improving with investment inflows on the property market from non owner occupier markets. Bank funding conditions continue to improve as wholesale borrowing costs continue to fall.
Asset performance improves as the ratio of non-performing assets to total loans 1.1% at June 14 down from 1.9% in mid 2010. The top four banks have managed to significantly reduce cost to income ratio to below 45% and Income and Cost to over $75b.