Australian hit on mortgage arrears due to higher interest rates

Australian Suncorp-Metway says impairment charges in its core banking arm increased in the third quarter as higher interest rates led to a jump in mortgage arrears. The group booked a AU$20m (US$17.7m) impairment loss for the three months to the end of March in core banking, which includes personal, retail and SME (small to medium-sized enterprise) banking. Impairments for the year to date are A$22m. Suncorp said there had been an “increase in mortgage arrears in the last quarter, off a low base, as interest rates have increased and the benefits of the government stimulus payments have been removed.”