Nathan Zaia: I think the results have been fairly solid and I was saying margins fall, but they're not collapsing, and bad debts are rising, but they're not exploding. So, I think they are the two things that people have been worried about. And the trajectory is down but that was to be expected from the base we're coming from.

On margins, we think the trajectory of weaker NIM will slow, and we're already seeing cash back offers pulled from the market. Banks are repricing. You have fixed loans moving from very, very low rates to much higher standard variable rates. So, they will be positive to margins. The one reason we do think margins still have a little bit more to go is because funding cost pressures are still flowing through. There's a lot of competition for customer deposits and banks have to refinance their own debt. So, there's going to be a lot of focus on raising and keeping those customer deposits.

On loan losses, we are starting to see a rise in people fall behind in their repayments, but they're still at levels much lower than historical rates. So, households are showing an ability to pull back spend. So, that's really encouraging. And the banks didn't really need to add to their provisions during the period. On fixed rate loans, the cliff that many have been fearing, we're not through all of it yet. But so far, some data that we've seen is really encouraging. CBA show that people in arrears across their book is similar to the rates that we see when fixed rates mature. So, those fixed rate customers aren't doing any worse than the rest of their book.

Bendigo and Adelaide Bank also highlighted a lot of those customers with fixed rates maturing, their loan to value ratio is below 60% and those with an LVR above 80% is really small. So, you need house prices to fall materially before that equity buffer is wiped out, and that's another positive sign that should protect earnings. Both Commonwealth Bank and National Australia Bank announced share market buybacks as well. I think that's probably another sign that management teams are feeling increasingly comfortable around the quality of their loan book. So, yeah, overall, pretty solid outcomes.

For ANZ, they're trying to bulk up their market share in home loans and it also brings over customer deposits, which are a good source of funding for the banks. And it's really about just adding scale and you can leverage your costs across a bigger business overall. For Suncorp, a bigger part of their business is insurance, and their bank is subscale. So, they've decided it doesn't make sense for us to continue running it. If we can sell it, get a good price, get those funds, return it to shareholders.

I think if it doesn't go through, Suncorp still have a couple of options. One would be to separately list it on the ASX and the second is Bendigo and Adelaide Bank being interested in merging. So, the combination of those businesses would increase market share in home loans to about 5%. The thing with either of those deals, we don't think Suncorp shareholders get as much as they're getting out of the ANZ deal, which is a premium to the book value of the bank. We don't think Bendigo and Adelaide Bank could offer as much as ANZ offered for Suncorp purely because the cost synergies that would be required to make the deal, EPS accretive and improve your returns, would probably be too great, and there's just too much risk with that sort of deal.