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Swan warns banks to pass on rate cuts

The Treasurer, Wayne Swan, gave notice yesterday that he would be pushing the banks to pass on any rate cut granted next week.

“I won't be pulling back from my discussion about the important issues associated with interest rate cuts; I will be making frank and fearless comments about that,” Mr Swan said. “We have very highly profitable banks in this country. Their return on equity is unequalled in the world.”

When the Reserve Bank last cut rates, before Christmas, the banks passed the reduction on only after several days of public exchanges with the government. They made it clear then that future rate reductions early this year were unlikely to be passed on in full, if at all.

Source: Sydney Morning Herald

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