Infographic: Storm clouds for Australia's banks

A heavy reliance on mortgages and deteriorating employment conditions threaten to undermine the financial performance of Australia's bank stocks.

Infographic: Storm clouds for Australia's banks

Australia’s ceaseless love affair with the housing market poses latent risks to investors in bank stocks as banks have become increasingly sensitive to economic deterioration and external shocks.

More than 63% of bank loan portfolios are extended to residential mortgages and the availability of cheap credit has driven house prices sharply higher in key cities like Sydney and Melbourne.

In just 20 years, average house prices have increased fivefold rising to A$1,190,000...

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