Banks prepare for rising bad debts

In its latest Financial Institutions Performance Survey, accounting firm KPMG noted that the impaired asset expense of the major banks jumped 191.9% in the March quarter from the December quarter to $320.2 million.

“Driving this change are significant increases to both individual and collective provisions,” KPMG said.

This is the fifth consecutive quarter in which collecting provisioning has increased, reaching $2.68 billion in the March quarter across all the banks, up 10.7% from $2.43 billion in the December quarter.

Individual provisions rose 7.7% to $284.1 million from $263.8 million in the December quarter.