Major banks earn billions, as Aussie housing market strengthens

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The booming housing market over the past six months may have led three of Australia’s big four banks to earning almost $11bn, industry experts predict.
 
ANZ, National Australia Bank (NAB) and Westpac are set to announce their half-year results soon, which analysts expect to carry solid gains. Deutsche Bank specifically foresees the three banks to grow their underlying earnings by around 3%, The Australian reported.
 
Deutsche Bank said Westpac may report cash earnings of $3.84bn, while ANZ and NAB may report $3.69bn and $3.33bn, respectively.
 
Fellow big four bank, the CBA, had earlier announced a half-year cash income of $4.62bn in February.
 
"We expect the results will be driven by solid lending growth in retail and business, modest group margin decline driven by lower institutional margin and improving markets income with FX and rates volatility driving stronger  customer flows," Analysts Andrew Trigg and James Wang said in a research note.
 
However, the Australian Prudential Regulatory Authority (APRA) is considering implementing a cap on lending growth and forcing the banks to lift the amount of capital they hold against loans, according to News Limited.
 
APRA chairman Wayne Byres last week indicated the regulator could act "sooner rather than later" on a recommendation from the recent Financial System Inquiry to lift capital reserve ratios for the major banks.