Banking on it: Increases in the cash rate are projected to return industry revenue to growth

IBISWorld’s Foreign Banks market research report offers insightful industry analysis and research into the market at the national level. IBISWorld’s in-depth industry market research is presented in a logical and consistent format. The industry report contains key industry statistics, market size, industry trends, and growth and profit forecasts for a 5-year outlook period.


Industry Analysis & Industry Trends

Low interest rates and weak demand for commercial lending have driven down industry revenue over the past five years. Revenue is expected to decline at an annualised 7.8% over the five years through 2016-17, to total $16.9 billion. Intense competition from domestic banks has further added to the industry's poor performance, holding back growth in foreign banks' lending portfolios, particularly in the residential mortgage lending of foreign subsidiaries. Industry revenue is expected to decline further in the current year, falling by 4.1% as the RBA maintains a record low cash rate. Despite falling revenue, profitability has improved over the period due to the lower funding costs for banks...

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Industry Report - Industry Analysis Chapter

Industry operators have endured a difficult trading environment over the past five years. Foreign banks have benefited from the growing global integration of financial markets and the increasing importance of global supply chains. However, industry revenue has declined significantly as consecutive cuts in the cash rate reduced operators’ interest revenue. Overall, industry revenue is expected to decline at an annualised 7.8% over the five years through 2016-17, with revenue falling by 4.1% in the current year, to total $16.9 billion. Uncertainty surrounding global economic growth prospects has forced many banks to reconsider their international banking operations. Several European banks have pulled out of the Australian market since 2009-10, redirecting funds to their home countries. How..

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Industry Products

What is the Foreign Banks Industry?

The industry comprises the banking activities of foreign bank subsidiaries, branches and representative offices in Australia. Foreign banks generate revenue through interest income on loans and advances, and fee and commission income.

Industry Products
Housing loans
Term loans
Other lending activities
Other financial products
Industry Activities
Development bank operation
Savings bank operation
Trading bank operation

Table of Contents

About this Industry

Industry Definition
Main Activities
Similar Industries
Additional Resources

Industry at a Glance

Industry Performance

Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle

Products & Markets

Supply Chain
Products & Services
Demand Determinants
Major Markets
International Trade
Business Locations

Competitive Landscape

Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
industry Globalisation

Major Companies

Operating Conditions

Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance

Key Statistics

Industry Data
Annual Change
Key Ratios

Jargon & Glossary

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