Australia's Four Big Banks May Need Support, Australian Says

By Angela Macdonald-Smith

Oct. 11 (Bloomberg) -- Australia's four biggest banks warned they may need extra support from the government and the central bank to prevent the country being sucked into a recession caused by the credit crisis, the Australian said.

The chief executive officers of Commonwealth Bank of Australia, Westpac Banking Corp., National Australia Bank Ltd. and Australia & New Zealand Banking Group Ltd. said in separate interviews that their funding costs could rise unless Australia is included in any global agreement to extend government guarantees to banks, the newspaper reported.

Australia may have to consider having a debt guarantee plan for a period of time to prevent the banks being discriminated against in comparison with banks overseas that may be weaker yet have guarantees, the Australian said, citing Commonwealth Bank Chief Executive Ralph Norris.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net