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Why the Fitch bank ratings review means no mortgage rate cut

31 January 2012, 17:50 PM | Source: Ricardo Goncalves, SBS

Australia’s major banks have been given a helping hand in their case to distance their interest rate decision from that of the Reserve Bank.

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Fitch placed the credit ratings of Australia’s big 4 banks on watch negative yesterday, noting their reliance of wholesale funds, a point Australia’s banks have been trying to make for some time.

While it’s nothing new, it reinforces their stance at a time when interest rates are bounced as a political football.

 To explain, I spoke with banking analyst, Brian Johnson from CLSA.

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