Could the Banking Royal Commission cause a credit crunch [Video] | Sky News Interview

The shock finding of the Banking Royal Commission could lead to an economic downturn if there was a significant regulatory response according to UBS economists.

Of course this could land a significant blow to house prices. Australia Economy Concept

“While a tightening of mortgage underwriting standards is prudent, especially as the banks move to fully complying with responsible lending, it has a material impact on the economy,”UBS economists  George Tharenou and Carlos Cacho were reported as saying in Domain.

“It must be remembered that house prices are determined by the demand and supply of credit (not the demand for and supply of housing).”

The first two weeks of the banking royal commission brought out nastier shocks than most expected including evidence of bribery, fraud, failure of internal controls, systemic issues and failures to report misconduct.

Watch the video below of my recent interview with Sky News where I discuss these findings:

It’s not time to panic yet.  

While more revelations will come out in due course, and some Australians have taken on a bit more debt than they can handle, in general our banking system is strong and on the whole mortgage serviceability of the average household remains strong.

There is no evidence that the ‘liar loans’, (I explain these in the video above) or the lax lending criteria have caused any major concern for the banks as mortgage arrears remain low and the fundamentals for our economy remain strong.


Subscribe & don’t miss a single episode of Michael Yardney’s podcast

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

Need help listening to Michael Yardney’s podcast from your phone or tablet?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.


Prefer to subscribe via email?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.

Michael Yardney


Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit

'Could the Banking Royal Commission cause a credit crunch [Video] | Sky News Interview' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.


Copyright © Michael Yardney’s Property Investment Update Important Information
Content Marketing by GridConcepts