The Australian economy is clouded by uncertainty and volatility as we start 2023. With the major Australian banks and other lenders safely navigating the pandemic, their resilience is now being tested by an evolving macro-economic environment.
While Australian banks have robust capital positions and are yet to see major credit quality challenges, they are working to grow (organically and inorganically) and transform their underlying businesses for the future, in recognition of potential storm clouds on the horizon.
Rising interest rates have created the circumstances for improved net interest margin in banking, but the strength of this financial position will be tested by falling house prices and potentially lessened consumer confidence. All this is occurring as banks and their customers survey the economic contours of our recovery from the COVID crisis and the impacts of the virus' continuing presence.
Against this complex backdrop, our latest Banking M&A Outlook explores the key focus areas driving banking M&A in the Australian market as we look ahead into 2023 and beyond.
Published: March 2023