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Bank fee revenue grows

Bank fee revenue grows

(19 May 2008 – Australia) A report by the Australia Bankers’ Association has shown that bank service fee revenue has grown to A$10.5 billion for the year ended June 2007. Businesses, including large corporations, are, for the first time in four years, the most important source of bank service fee revenue. Of this total, businesses contributed 58 percent and households 42 percent.

The ABA said that the main driver of growth in bank service fee revenue has been strong demand for banking products and services, underpinned by a strong economy.

The report also confirmed trends established in previous years, particularly that while bank service fee revenue continues to increase, on the back of a strong economy, it is falling against key benchmarks.

In household transaction accounts, the average growth of transactions over the last three years was around 8.5 percent, whereas the average growth in bank service fee revenue is 6.4 percent.

This year’s results show a further decline of bank service fee revenue in proportion of bank assets. Bank service fee revenue has grown 7.6 percent, considerably slower than the very strong 17.6 percent growth in bank assets.

David Bell, chief executive of the Australian Bankers’ Association, said that the past two years has seen the strongest demand for banking products and financial services on record.

He added that this was driven by growth in wages and real incomes, employment, low unemployment, population increases and company profits.
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