(10 May 2011 – Australia) Growing concern at rising interest rates affecting consumer’s ability to repay loans was voiced by ANZ Banking Group boss Mike Smith.He said poor credit quality was a concern as people were not paying off credit cards, he said this was strange as it normally occurred during periods of rising unemployment.
Mr Smith said it now appeared to be seasonally related, noting ‘a little bit’ of a situation where people were going on holidays and not repaying the monthly debt on their credit cards.
‘But I think that interest rates are beginning to hurt a little bit now, so the recent rises are beginning to bite,’ he said, adding that the Queensland floods had contributed to the issue.
He also made clear his view that he didn’t expect credit growth to return to the levels that had been seen before the global financial crisis.