Australian Banks Fortnightly "Money in the Bank: Issue #22" Storey

Research evidence excerpt

Australian Banks Fortnightly "Money in the Bank: Issue #22" Storey

Global Research

15 May 2026ab

Australian Banks Fortnightly Equities

AustralasiaMoney in the Bank: Issue #22

Financial

John Storey, CFA

UBS Australian Bank Fortnightly: Money in the Bank Analyst

In this fortnight's issue, we look into a news flow heavy past few days for the sector. john.storey@ubs.com

Namely, this issue covers 1) The Federal Budget and what this means for bank stocks, 2) +61-2-9324 3864

Earnings seasons is now complete and we discuss which banks look better placed, and Nicholas Sobolev

3) We provide a framework to contextualize and work through what higher funding Analyst

costs on banks non-interest bearing liabilities could imply for banks. The majors large nicholas.sobolev@ubs.com

non-interest bearing (NIB) deposit base might not as enduring as assumed or provide the +61-2-9324 3026

moat it has if AI or mkt forces disrupt it. We conduct a scenario analysis on NIB deposit

being competed away and the impact on bank's operating models & valuations.

Key themes impacting share prices over the past fortnight

1. Federal budget: This Tuesday the Federal Government released the 2026 budget

(here, here & econ note here). Reduced tax incentives and removal of negative

gearing should lower investor mortgage growth, decrease margins, and have a

broadly neutral impact on asset quality. Overall, banks more exposed to investor

lending (CBA, WBC) appear more at risk, while banks with stronger business and

institutional banks (NAB, ANZ) are likely the relative 'winners'.

2. 1H26 earnings wrap: That's a wrap. Earnings season is over (results wrap here),

with mixed results. We expected increasing collective provisions charges, notable

in a +$200M increase in CBA's 3Q26 update, a driver of their miss.