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With international funding markets still dry, Australian businesses are increasingly looking to local banks to finance their operations.
The latest East & Partners Institutional Banking Markets report found that three out of every four top Australian businesses now rely on domestic debt lines from their bank.
Zoran Knezevic, analyst with East & Partners, said the demand for plain vanilla bank debt was an effect of the contraction in other funding markets, caused by the US sub-prime crisis.
In the past few years demand for such debt had contracted Mr Knezevic said, but the latest report had unveiled a dramatic turnaround.
Mr Knezevic said the growing reliance on debt among Australia’s biggest businesses had been good news for leading debt providers particularly Commonwealth Bank and National Australia Bank.
Published: 22-05-08
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