Investors
P: 1800 658 404
View full details
Financial advisers
Contact your state account manager or our client services.
View full details
Shopping Centres
For leasing, casual leasing and brand solutions enquiries
Contact Us
Connect with us to stay up to date with news and updates.

LinkedIn

Investment perspectives: outlook for Australian banks


As the Australian share market enters bear territory, we discuss the implications for the major banks

In this video, we discuss the outlook for Australian banks following recent market movements, and identify opportunities for investors in this environment.

Equity perspective

The major banks have been under pressure for the past 12 months. Share valuations for some of the banks are now approaching valuation levels last seen during the Global Financial Crisis (GFC), while dividend yields for the major banks have risen by 2% over the past 12 months. A slowdown in the housing market and lower commodity prices are likely to drag earnings growth, causing more share price volatility in the near future.

Credit perspective

Credit spreads of the major banks have widened sharply since the start of February, with spreads on some securities approaching their widest levels of the past three years. This widening has been driven by:

Final thoughts

We believe the investment opportunity for bank shares depends on the macro environment. In credit markets, the widening of credit spreads for Australian banks has resulted in more attractive valuations over a medium term investment horizon. However, we are mindful that risk aversion is likely to remain elevated in the near term.

Featured
Jeff Brunton, Investment Director, AMP Capital
Sonia Baillie, Head of Credit Research, AMP Capital
Tom Young, Portfolio Manager and Analyst, AMP Capital
Taking your SMSF to the next level
Download now

Sign up to our newsletter!

Receive regular insights and marketing communications including a weekly update of tending news and market insights that are tailored for SMSF trustees and investors.
Sign me up
AMP's Australian operations are bound by the current Australian privacy legislation which outlines how organisations should manage and use personal information collected and held about their customers. AMP Privacy Policy

Thanks for subscribing

Thank you for subscribing to our weekly highlights newsletter.
Your privacy is important to AMP Capital and we are bound by the current Australian privacy legislation. View our privacy policy
Submit and close

Sign up to our newsletter!

Receive regular insights and marketing communications including a weekly update of tending news and market insights that are tailored for SMSF trustees and investors.
AMP's Australian operations are bound by the current Australian privacy legislation which outlines how organisations should manage and use personal information collected and held about their customers. AMP Privacy Policy
Sign me up Not right now. Thanks

Sign up to our newsletter!

Receive regular insights and marketing communications including a weekly update of tending news and market insights that are tailored for SMSF trustees and investors.
AMP's Australian operations are bound by the current Australian privacy legislation which outlines how organisations should manage and use personal information collected and held about their customers. AMP Privacy Policy
Sign me up