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David Murray says banks would be hit by AAA credit downgrade
Financial system inquiry chairman David Murray says the federal government could lose its prized AAA credit rating, and the downgrade would hit all the large banks. Mr Murray, speaking before giving a keynote speech to The Australian Financial Review's Banking and Wealth Summit on Tuesday, said the deterioration in the federal budget increased the urgency for banks to set aside extra capital to protect themselves during a foreign funding crisis. The warning was amplified by Deutsche Bank, which said Australia was headed for 15 years of budget deficits and the government's debt was likely to go close to the level that ... (full story)