This trend is well documented for the US, Europe and the UK in a graph from a recent paper published by some of my colleagues on the Committee on the Global Financial System.2 In Australia, since mid 2007, deposits have grown at an annualised pace of 11 per cent, compared with credit growth of 5 per cent.
As a result, while the level of wholesale issuance by Australian banks in 2011 is about the same as that in 2007, it is a significantly smaller share of total bank funding. In the US, there are three developments that stand out. First, is the marked decline in the issuance of non-agency mortgage-backed securities.