Fitch on Australian banks - profit growth likely to slow in 2018

Fitch citing global monetary tightening pushes up funding costs, loan-impairment charges rise, and tighter regulation

• These to slow profit growth this year for the banks in Australia
• Business volumes to slip and compliance costs rise

Australian banks are more reliant on offshore wholesale funding than global peers

• Global monetary tightening could therefore push up banks' funding costs
• impact is likely to be contained by banks' hedging of foreign-currency borrowing back to Australian dollars, while only a portion of the wholesale funding is refinanced each year

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