What is the difference between lending to individual


1. Explain the difference between bank credit risk and bank capital risk?

2. What is the difference between lending to individual borrowers via a residential home mortgage compared to other types of consumer lending?

3. (i) Graph on two separate lines for 2007 to 2014 (1) the residential loans as a percentage of total loans and (2) impaired loans (NPLs)/gross loans. Please include the 4 major Australian banks and Barclays Bank* in the UK.

(ii) Explain the reasons for any change in the importance of residential loans

(iii) Interpret these banks' credit quality over 2006-2014

4. Explain the impact you would expect from Australia's introduction of comprehensive credit reporting (CCR).

Word limit: 2,000 words

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