The additional capital needs of Australia's banking sector may be "impossible to calculate", David Murray, chair of the Financial System Inquiry, told an industry conference yesterday.
The final report of Murray's panel, released earlier this month, said Australian banks must aim for "higher capital levels" to increase resilience.
Some analysts say the industry will have to build capital by upwards of A$20 billion, but this differs depending on the estimator.
And it seems Murray believes endeavouring to work out the exact requirement to reach the "top-quartile positioning" that the FSI panel has said "is the right setting for Australian ADIs" is a challenge not worth pursuing.
Speaking at the Australasian Finance and Banking Conference in Sydney, Murray said the market should get used to high levels of uncertainty and analysts should give up trying to predict what capital levels will be required, the
Fairfax Media reports.
"Unfortunately, the market analysts have tried to nail every component of this down to the 10th decimal point, but impossible to do so," Murray said.
"Analysts do this for competitive reasons - to work out who is sharper with the pencil than somebody else. That's what they do, and we can't do much about that ... [But] there is so much to change here it is impossible to calculate."