Banks big winners in commercial finance slump

The amount of commercial finance loans written by banks has soared in June, according to the latest ABS figures.

In June banks wrote a total of $34.7 billion worth of commercial loans, up from $29.4 billion in April. The sector accounts for 93% of all commercial loans written in Australia.

As with housing finance, and personal lending, banks were the only beneficiaries in a month when commercial finance fell 6.5% on a seasonally adjusted basis following an increase of 8.8% in May.

The latest figures come as the Commonwealth Bank revealed a 22% increase in second-half profits on the back of increased business and household lending.

At the same time smaller developers continue to have problems obtaining finance for commercial developments.

Revolving commercial credit commitments fell 8.4% and fixed lending commitments fell 5.6% over the month.

Since December 2010 when commercial finance commitments increased from $30.5 billion to $32.8 billion, commercial mortgages have followed a pattern of falling one month and rising the next.

The decline in June takes commercial mortgage commitments below the $30.1 billion achieved in October 2010.

Personal lending fell marginally in June, with commitments of $6.99 billion, compared with $7.05 billion in May and $6.82 billion in April.

Banks share of personal lending stands at 85% – banks wrote $6.8 billion out of $8 billion of personal loans in June

Leasing suffered the biggest monthly drop, falling 7.2% to $374 million.

As revealed yesterday, owner-occupier mortgages remained flat at $14.1 billion.