‘Growth of a New Era’ – Australian banks will have ‘real’ growth in 2015
AUSTIN (Reuters) – Australian bank Aussie Financials is poised to grow its business by 20 percent in 2015 and is expected to hit the $1 trillion mark in earnings, Chief Executive Officer Paul Ritchie said on Tuesday.
Ritchie made the remarks at a conference for banks in Austin, Texas, to be held by the American Bankers Association (ABA) annual meeting.
Ritchy said the ABA expected Australian banks to grow by 20% in 2015, up from 14.6 percent in 2014, and forecast revenue to grow 11.9 percent.
He also said Australian banks were on track to exceed the $2 trillion threshold, which is the maximum amount of money a bank can earn without running out of money.
“We’ve been a strong growth story for the last 10 years,” Ritchie told Reuters, speaking of Australia’s record economic growth of 4.3 percent in the 12 months to March, up 17.5 percent from the previous year.
“So, to say that we’re not at that mark right now is a big understatement.” “
The bank’s quarterly results were due in early November. “
So, to say that we’re not at that mark right now is a big understatement.”
The bank’s quarterly results were due in early November.
The bank has a long list of initiatives in the works, including a $1 billion dividend and a new $2 billion fund for the next five years.
Rippy said his bank’s growth was not driven by “trends or trends driven by the Fed,” but by the strength of the Australian economy.
The ABA is also looking at other areas of business, including consumer credit, financial services and the Australian banking industry, he said.
The group’s annual meeting, which takes place on Wednesday, is expected be dominated by the economic recovery.
“It’s going to be a very interesting year for the Australian business community,” Rippie said.
“There’s a lot of things that are coming out in the banking sector that will be quite interesting to look at, but the big news is the economic and financial sector.”
The Australian government, which has been pushing for a faster recovery from the global financial crisis, has been in the spotlight over the past few years as the economy has shed jobs, a slowing inflation rate and a sharp drop in the value of the dollar.
ABA President and CEO Tim McInerney told Reuters last month that he expected a recovery in the economy to be “tough but not impossible” over the next few years.
A further tightening of the rules to allow banks to engage in the financial business of the financial system is expected in the next two years, as well as a push for tighter regulation in Australia’s capital markets, he added.
“The economy is slowing, inflation is going down and we have an increasing focus on the capital markets and the banking system,” he said at the time.
“I think the expectation is that over the course of the next 12 months, the banks are going to have to go into the capital market and engage in lending.”
Ritchie, who joined the AEA in 2013, was appointed CEO of the bank in 2014.
He is in his fourth year as CEO.
In an interview with Reuters in February, Ritchie had said the bank was “really confident” about the economic prospects of the AIA.
“What we see in Australia is really a pretty strong recovery, which in my mind is a very good sign,” Rittery said at that time.
Ritchery, who was born in New South Wales, said the business was “getting stronger.”
The head of the country’s largest lender, which makes loans to customers around the world, said he had been pleasantly surprised by the economy and the growth of the banks.
“A big reason for the strong performance that we’ve seen in the AFA is that we have been able to create more jobs, I think more than anything else,” Ritcherie said at a financial services conference in the Sydney suburb of Macquarie Park last week.