Unemployment a key risk to the Commonwealth Bank
The Commonwealth Bank's Chief financial officer, David Craig, has told The Australian that from a macro economic perspective, unemployment was the bank's key risk.
If unemployment keeps rising it will threaten the quality of the bank's loan book he said, but for now they aren't worried. While its economists predict that the next likely move of the RBA will be an increase in the cash rate, most think this is still some way off.
But news this week that Toyota was pulling out of Australia signaling the end of car manufacturing in Australia has sparked concerns about growing unemployment.
Yesterday, the bank delivered a record half yearly profit of $4.27 Billion, underpinned by higher revenue growth and lower bad loans, as the low interest rate environment helped customers to stay on top of debts.
The record low interest rates has sparked a home loan war between major home loan providers and consumers are being advised to be savvy and hunt around for the best deals or renegotiate better rates with their current lender.
According to the mozo database, the lowest variable rate loan in the market is currently 4.49% (4.51% comparison) with online lender loans.com.au and the best 1 year fixed rate is 3.99% by IMB. Compare all home loan interest rates on Mozo here.