The Reserve Bank of Australia (RBA) has released its Financial Stability Review for October 2025, assessing the condition and resilience of the country’s financial system.
According to the RBA, “Australia’s financial system remains well positioned to navigate a period of elevated global uncertainty.” The central bank identifies the main risks to financial stability as originating from international sources. These include increasing government debt in major economies, high asset prices and leverage in global markets, as well as heightened geopolitical and operational threats.
Despite these external risks, the RBA notes that Australian households, businesses, and banks are generally prepared to manage potential shocks. The report states that most mortgage holders are meeting their repayment obligations and have accumulated savings buffers. Many businesses have also built up financial reserves. Additionally, Australian banks maintain strong capital and liquidity levels, which enables them to support the economy during possible disruptions.
The Review emphasizes the ongoing need for financial institutions to uphold prudent lending practices and enhance their operational resilience.
