ANZ's Australia chief executive has warned that home loan arrears will continue to escalate "for a while".
The Australian chief executive of financial giant ANZ has expressed concern about mounting home loan arrears, but insisted risks to the wider economy remain relatively modest for the time being.
Speaking to Reuters, Philip Chronican said that although many consumers will struggle to pay off their home loans "for a while", the situation need not approach "disaster" levels provided appropriate action is taken.
His remarks came after research from Fitch Ratings indicated a surge in mortgage delinquencies during the opening quarter of the year, with the expected post-Christmas slowdown and recent natural disasters having an impact.
However, Mr Chronican admitted to fears over the Reserve Bank of Australia's rumoured interest rate hikes and observed that house prices are likely to remain deflated over the remainder of this year.
Earlier this week, Liberal MP and former employment minister Joe Hockey claimed Australia is facing a property "affordability crisis", with the construction of new homes failing to keep up with demand.
By Nate Sawyer
