Genworth keeps eye on risky housing market
The chief executive of Genworth Mortgage Insurance Australia believes the housing market may have bottomed out in some mining regions in Queensland and Western Australia as first home buyers start investing.
Genworth Mortgage Insurance Australia chief executive Georgette Nicholas told the Australian Financial Review pressures in the economy were weighing on the housing market.
"In some of the mining areas you have actually seen a bottoming of the market and the way to assess that is that you see first home buyers coming in," she said.
"On the flipside employment is still challenged and we're still seeing underemployment.
"That is something we continue to watch."
Credit rating agency Moody's had downgraded Genworth from A3 to Baa.
The AFR reported Moody's uninitiated downgrade of Genworth came after a wider review.
The AFR reproted Moody's as saying "[The review] was part of a wider ratings action on Australian financial institutions to reflect Moody's view that risks in the Australian housing market have risen, heightening the financial sector's sensitivity to adverse shocks."
"The downgrade of Genworth Australia's rating reflects both the high and rising level of tail risks embedded in the Australian housing market and reduced demand for domestic lenders' mortgage insurance products."
