Fact sheet

Liabilities
Data in this paper are sourced from the Reserve Bank of Australia monthly statistics.
Liabilities
Banks liabilities consist of deposits, bill acceptances, other borrowings and other liabilities. Banks
borrowings include their short-term and long-term wholesale funding liabilities, both domestic and
offshore (see the section Bank Funding for more detail on this aspect of banks liabilities).
Note that liabilities are one side of the balance sheet of banks, the other is assets. Readers should refer
to the section on Assets for more information.
Summary
At the end of June 2013, total liabilities of Australian banks were $2.9 trillion, of which $2.2 trillion or 76%
were resident liabilities (i.e. liabilities on the books of banks with any individual, business or organization
domiciled in Australia), $552 billion were non-resident liabilities (i.e. liabilities on the books of banks with
any individual, business or organization domiciled overseas) and $139 billion was the amount due from
overseas operations of banks.

Source: RBA

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ABA-#117451-v1-Website_-_Liabilities_(June_2013).docx

Australian Bankers Association Inc

Liabilities

The largest component of banks liabilities is deposits (i.e. household deposits, business deposits and
other deposits). As at June 2013, deposits of banks by residents made up 61% of total bank liabilities
and 81% of banks resident liabilities.
At the height of the global financial crisis, deposits as a proportion of total bank liabilities were 52%.

Growth in banks resident liabilities

At June 2013, banks resident liabilities were $2.2 trillion.
Over the 10 years prior to the start of the global financial crisis (August 1997 August 2007), the
average annual growth rate for banks resident liabilities was 13%.
Over the 12 months ending June 2013 growth in banks resident liabilities was 4.5% or $95 billion.

Source: RBA

Australian Bankers Association Inc

Liabilities

Deposits
At the end of June 2013, deposits of residents with banks were $1.78 trillion. This includes household
deposits, business deposits and other deposits.
Growth in resident deposits reached record levels, as high as 35% over the 12 months to the end of
January 2008. In particular, deposits grew at record levels in late 2007/early 2008.
Over the 1990s, growth in resident deposits averaged 9% per annum.
The very high growth rates for deposits from August 2007 were a result of a combination of factors.
Over this period:

households were shifting their asset mix away from equities and housing to bank deposits,
particularly in response to large falls in the equities market.
as the cost of bank funding increased, bank competition for deposit funding was strong. As
such, interest rates on deposits were attractive (especially at a time when other assets
such as equities and housing were not performing well).
large falls in housing interest rates over late 2008, as well as the fiscal stimulus, assisted in
keeping the level of deposits high.

Source: RBA

Australian Bankers Association Inc

Liabilities

Retail deposits
The definition of deposits used above is broad. More commonly, the concept used is retail deposits.
These are deposits from households and businesses (i.e. non-financial corporations).
At the end of June 2013, a total of $969 billion of retail deposits were held by ABA member banks (i.e.
from households and businesses). This is an increase of $47 billion or 5.0% over the past year.
Households made up $585 billion (60%) of these deposits and businesses made up $385 billion (40%).

Source APRA

Over the past year, to the end of June 2013, annual growth for deposits from households was 7.5% an
increase of $41 billion.

Source APRA

Australian Bankers Association Inc

Liabilities

For businesses, growth rates for deposits peaked in the August 2007 at 23.8%. Over the past year to
the end of June 2013, the annual growth for deposits from businesses was 1.5%.

Source APRA

Borrowings
A significant part of banks liabilities are the borrowings they take out to support their funding needs in
order to carry out their day to day business operations such as lending to customers. These borrowings
can be sourced either from domestic markets or from overseas.
RBA statistics for June 2013 show that non-resident liabilities of banks were at $552 billion or 19% of
total liabilities (a significant proportion of this is borrowings) while other borrowings (which are resident
liabilities) were $179 billion or 7% of total liabilities.

Document created: September 2013

For further information, please contact ABA Director Public Relations Heather Wellard on 02 8298 0411,
e-mail Heather Wellard or write to the ABA at Level 3, 56 Pitt Street, Sydney, NSW 2000.
Internet: www.bankers.asn.au Ph: 02 8298 0417 Fax: 02 8298 0402