Normal
Part of the reason for this is the regulators in Australia are not supportive of having ultra long term fixed loans because it adds systemic risk to the banking system.The Australian system disperses the risk to millions of homeowners whereas in other countries such as U.S.A, some European countries etc the risk is concentrated into large financial institutions, pension funds etc that buy those 30 year fixed rate mortgage backed securities.That can cause a buildup of systemic risk in their financial system when too big to fail institutions blow up their balance sheets in a high inflation environment by owning mountains of 30 year fixed rate bonds.
Part of the reason for this is the regulators in Australia are not supportive of having ultra long term fixed loans because it adds systemic risk to the banking system.
The Australian system disperses the risk to millions of homeowners whereas in other countries such as U.S.A, some European countries etc the risk is concentrated into large financial institutions, pension funds etc that buy those 30 year fixed rate mortgage backed securities.
That can cause a buildup of systemic risk in their financial system when too big to fail institutions blow up their balance sheets in a high inflation environment by owning mountains of 30 year fixed rate bonds.
Hello and welcome to Aussie Stock Forums!
To gain full access you must register. Registration is free and takes only a few seconds to complete.
Already a member? Log in here.
