A UBS forecast that banks in Australia would axe several thousands of positions over the next two years was validated by a National Australia Bank (NAB) executive on Monday.
However, the address of Lisa Gray, NAB head of personal banking, at the Trans-Tasman Business Circle lunch in Melbourne covered a longer time span. Ms Gray said the 142,000 employees of the big four would shrink over the next couple of decades due to technology.
She explained that it would cover both higher usage of personal mobile banking services and streamlining of day-to-day banking transactions. Ms Gray added the lenders would experience a continued slowdown in the days ahead.
"We're seeing a continued uncertainty, and that just moved around day by day.... We're seeing consumers and businesses respond to that in a very prudent way. Lending growth at the consumer, household level is the lowest it has been for decades," The Sydney Morning Herald quoted the NAB officials.
Her statement was confirmed by Veda, a credit intelligence data provider, which reported that the overall credit demand index went down 0.5 per cent in the June quarter which was preceded by a 4.4 per cent decline in the March quarter.
Demand for mortgages initially grew due to the stimulus after the global financial crisis, but it eventually slowed down, explained Angus Luffman, the head of consumer risk at Veda.
"That spike in growth peaked and then the moment the stimulus was taken away the growth trailed off. Mortgage inquiries have now flattened out after a long period of decline over the past couple of years," Mr Luffman was quoted by The Sydney Morning Herald.
The drop in credit card applications was somewhat offset by higher demand for personal loans and mortgage applications but insufficient to prevent the overall credit demand index from going down in the quarter.
Mr Luffman said the near-term increase in credit demand was the result of the household assistance payments and the 75 basis points overnight cash rate cuts made by the Reserve Bank of Australia in May and June.
Thus, personal loan applications went up 1.4 per cent, mortgage applications rose 4.8 per cent, but credit card applications dipped 2.4 per cent.
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