The Australian bond market functioned well during the financial crisis. Changes in investor sentiment and issuer behaviour led to a slowing in issuance and an increase in the average credit quality of new issuance. While the average bond term shortened and spreads widened, these trends have...

Bonds are an important source of funding for Australian banks. While the financial crisis greatly affected capital markets, overall Australian banks retained good access to the bond market, with a sharp increase in the volume of bonds issued over the past couple of years. This reflected their...

The global financial crisis has led to increased lending by the International Monetary Fund (IMF) to member countries. With IMF resources low by historical standards before the crisis, the IMF has funded this increase in lending partly by borrowing from member countries; this is the first time...

We add a simplified banking sector to the RBA’s macroeconometric model (MARTIN). How this banking sector interacts with the rest of the economy chiefly depends on the extent of loan losses. During small downturns, losses are absorbed by banks’ profits and the resulting effect on the broader...