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Queensland property portfolios more profitable than New South Wales

Fujitsu Australia Limited

Sydney, September 26, 2006

Queensland property portfolios are intrinsically more profitable on average compared with New South Wales, according to the latest Fujitsu/JPMorgan Australian Mortgage Industry Report (Volume 4).

The report, which was published today, also found that the most profitable customers, Australia-wide, are becoming more profitable for lenders and brokers, while the reverse is true of unprofitable customers.

Martin North, Managing Consulting Director, Fujitsu Australia and New Zealand said, “The growing gap between profitable and unprofitable customers is a result of higher fees offsetting interest margin reductions and higher churn in unprofitable customer groups.”

According to the Australian Mortgage Industry Report, New South Wales contains the most profitable and unprofitable customers in Australia, compared to lesser extremes of profitability/unprofitability in Queensland. This can be explained in part by the fact that the average loan size in New South Wales is larger, reflecting higher house prices in the state.

In addition, Loan-to-Value-Ratios (LVRs) are significantly higher in New South Wales than Queensland. The average LVR in New South Wales has risen from 51 per cent in 2003 to 78 per cent in 2006, compared to Queensland, where the average LVR has risen from 46 per cent in 2003 to 65 per cent in 2006 – a jump of 19 percent, compared to 27 per cent in New South Wales.

Martin North said, “The combination of high LVRs, rising interest rates, stalling house prices in some sectors and a doubling of repossessions over the past two years in New South Wales indicates there are inherent risks in New South Wales property portfolios.”

About Fujitsu Australia Limited

Fujitsu is a full service provider of information technology and communications solutions. Throughout Australia and New Zealand we partner with our customers to consult, design, build, operate and support business solutions. From strategic consulting to application and infrastructure solutions and services, Fujitsu has earned a reputation as the single supplier of choice for leading corporate and government organisations. Fujitsu Australia Limited is a wholly owned subsidiary of Fujitsu Limited of Japan. For more information, please see:

About Fujitsu Limited

Fujitsu is a leading provider of customer-focused IT and communications solutions for the global marketplace. Pace-setting device technologies, highly reliable computing and communications products, and a worldwide corps of systems and services experts uniquely position Fujitsu to deliver comprehensive solutions that open up infinite possibilities for its customers' success. Headquartered in Tokyo, Fujitsu Limited (TSE:6702) reported consolidated revenues of 4.7 trillion yen (US$44.5 billion) for the fiscal year ended March 31, 2005. For more information, please

Elizabeth Greene

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Company:Fujitsu Australia and New Zealand Limited

Date: 26 September, 2006
City: Sydney
Company: Fujitsu Australia Limited