The difference between the two reports is explained by what they cover. The RBA’s analysis includes all home loans on bank balance-sheets plus “securitised” loans: over $1.2 trillion worth in total. In contrast, Fitch’s research only covers securitised loans, which amount to less than $100 billion. To be clear, these loans are included in the RBA’s sample, but represent less than 10% of the total.
The RBA concludes that total home loan arrears in Australia declined—not increased (as Fitch argued)—in the second-half of 2011. Specifically, the RBA comments:
“The arrears rate for housing loans (on banks’ domestic books plus securitised housing loans) declined to 0.6 per cent in December, from 0.7 per cent in mid 2011. The non-performing rate for credit cards has also improved, falling from 1.4 per cent in June 2011 to 1.2 per cent in December, while the rate for other personal loans has been broadly unchanged since mid 2011 at around 2 per cent.”
