The credit quality story may not be straightforward in Australian banking, if markers of stress in Westpac's banking book are anything to go by.
Mortgage stress increased on home loans in Western Australia and Victoria over the June 2015 quarter, Westpac said in a presentation to supplement its "pillar 3" report yesterday.
Home loans in arrears by 90 days or more lifted by two basis points to 49 basis points, with most of the rise in the two states mentioned above.
Arrears of 90 days or more on car loans were also "a little higher," the bank said.
On business lending, Westpac said "some portfolios experienced a rise in stress including retail, manufacturing and utilities," with the rise in the last two sectors "isolated to a small number of names."
It said these trends were "related to pressure in the commodity sector", although stress indicators on mining loans (a minor product for any bank) reduced.
However, the bank said there was a fall in stress in most portfolios, including commercial property.
Looking longer term, there has been a significant rise in personal loan arrears between September last year and June and a smaller increase in credit card arrears.
ANZ, Commonwealth and Macquarie Banks have all outlined a rise in impaired loans in disclosures over the past week.
Fairfax Media reports that National Australia Bank has "red-flagged" 40 postcodes where business and personal loans are at higher risk of default because the areas are over-reliant on single industries, have high unemployment or property prices have run too hard.
In the 40 hotspots the bank is conducting more stringent assessments of loan applications, including increasing the amount of equity that borrowers require.