Credit crisis 'waning'
By | smh.com.au | 01 May
WESTPAC Banking Corporation chief financial officer Phil Coffey believes the worst of the global credit crunch is probably over.
Mr Coffey, along with chief executive Gail Kelly, said the bank had seen some signs of easing with regard to access to credit in the past month. Pricing had also fallen, but was still higher than a year ago.
"There's been quite a lot of commentary that we have seen the worst of it, that the worst losses have been divulged," Mr Coffey said. "We would probably subscribe to that view."
His comments followed similar remarks by US Treasury Secretary Henry Paulson yesterday. Mr Paulson said the credit crisis, now in its ninth month, probably was more than half over, and retained his forecast for the US economy to keep growing. "We are closer to the end of this than we are to the beginning," Mr Paulson said. Even with "head winds and despite some of the things that we're going through, this (US) economy is still growing, albeit modestly", he said.
In Sydney, Mrs Kelly said that five years of very buoyant conditions in the Australian financial services sector had probably come to an end. "I think those days have changed," she said.
But she tempered her remarks by stating that she thought the local economy was in for a soft landing.
Housing credit growth was likely to run at 9% or 10%, rather than 13%, and business credit growth was expected to come down from between 10 and 12%, she said.
Business credit growth had consistently run in the high double digits in the past five years.
To sum up, Mrs Kelly said she expected a "slowing economy but still a robust economy".
AAP
First published by Smh.com.au on May 01 2008
Visit smh.com.au for the latest news updated throughout the day
