Australian Banks Face 5% Earnings Downgrades From Tax Change -- Market Talk
Dow Jones
May 22
0150 GMT - Softer mortgage growth and margin headwinds stemming from the Australian government's changes to capital gains tax could result in fiscal 2027 earnings downgrades of about 5% for the country's major banks, Morgan Stanley analysts say. They tell clients in a note that a deterioration in housing market sentiment would also increase the probability of lower valuation multiples for bank stocks. Positively for consumers, the MS analysts observe that weaker loan growth typically leads to more competition. This means that front-book discounts could widen for the first time since 2022, they add. (stuart.condie@wsj.com)
(END) Dow Jones Newswires
May 21, 2026 21:50 ET (01:50 GMT)
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