The Westpac Banking Corp (ASX: WBC) share price is up 5% in a month.
In fact, shares of Australia's second-largest bank are up around 8.6% since the beginning of September and it paid a dividend.
So what
Westpac has the country's largest exposure to investor loans, which have been a key point of concern for the banking regulator. Therefore, I find it a little surprising that the bank's share price has performed so strongly, especially since the broader S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has returned just 4% over three months.
Then there's the forecast slowdown in local credit markets, which the major banks heavily rely upon to generate outsized returns for shareholders.
Now what
Together, increased regulation on investor loans, a slowing economy and the requirement to increase their capital buffers for economic shocks, could place further pressure on Westpac's share price over the medium term (two to three years).
Given Westpac shares appear fairly valued today, I'm not a buyer of shares.
