Financials currently make up about 40% of the Australian ASX 200 market index. Since self managed super funds are commonly used to invest in direct shares it is crucial to get a clear understanding of the risk your super fund is exposed to should it hold a substantial amount of its capital invested in Australian shares.

The global banking regulator (Basel Committee on Banking Supervision ) is of the view that Australia’s banking regulator (APRA) lenient treatment of investment property loans means its five largest banks aren’t holding as much as capital against these assets as they should be.