Moody's credit rating agency has warned Australia's large banks that they may have their high ratings downgraded as prolonged low interest rates in the country continue to put pressure on the banks' credit profiles. The Australian Prudential Regulation Authority (APRA) said it was concerned about a possible downgrade of its AAA rating, which is one notch above investment grade. Last week, National Australia Bank, Westpac, ANZ and Commonwealth Bank had their ratings downgraded by Standard & Poor's to AA- with a negative outlook.
Moody's credit rating agency has warned Australia's large banks that they may have their high ratings downgraded as prolonged low interest rates in the country continue to put pressure on the banks' credit profiles. The report also suggested that low wages and high housing prices throughout Australia are raising the tail risks for banks with an increase in household debt and overall credit-to-GDP ratios. Last week, National Australia Bank, Westpac, ANZ and Commonwealth Bank had their ratings downgraded by Standard & Poor's to AA- with a negative outlook.