A senior Reserve Bank official says Australia's banks are "unquestionably strong" despite financial stability concerns rocking global markets.
The comment by Reserve Bank of Australia assistant governor for financial markets Christopher Kent comes in the wake of UBS Group's takeover of troubled rival Credit Suisse.
The drama surrounding the major Swiss bank, coupled with the failure of two smaller US banks in the past fortnight, has sparked concerns over the health of the global financial system.
In a speech to KangaNews DCM Summit in Sydney, Dr Kent said volatility in Australian financial markets had "picked up" but they were "still functioning".
"And, most importantly, Australian banks are unquestionably strong - the banks' capital and liquidity positions are well above the Australian Prudential Regulation Authority's regulatory requirements," he said.
"Banks are already well advanced on their bond issuance plans for the year and could defer their bond issuance for a while," he added.
"Even if markets remain strained for a time, Australian banks' issuance will continue to benefit from the strength of their balance sheets."
Under the Credit Suisse deal brokered overnight, Swiss banking giant UBS will pay three billion Swiss francs ($A4.82 billion) for its biggest rival and assume up to $US5.4 billion ($A8.1 billion) in losses.
The deal will be backed by a massive Swiss guarantee and is expected to close by the end of 2023.
The acquisition follows efforts in Europe and the United States to support the sector since the failure of US lenders Silicon Valley Bank and Signature Bank.
