Australia's largest business lender, National Australia Bank, on Monday said it expects to incur credit impairment charges of ‌A$706 million ($503 million) in the first half, as the Iran war roils the ‌global economy and financial markets, Reuters reported. The bank said it was now predicting more bad debts to occur as the ​likelihood of an Australian "downside economic scenario" was rising due to the Middle East conflict. NAB shares were down as much as 3.8% on Monday as the S&P/ASX200 was off 0.24% in early trading. The ASX200 financials index was 0.67% lower, dragged down by NAB.

Companies in Australia and New Zealand are beginning to signal the financial strain from the U.S.-Israeli war on Iran, as higher fuel prices stoke inflation, dent business and consumer confidence, and weigh on corporate earnings, Reuters reported. Australia's largest business lender, National Australia Bank, warned on Monday of a first-half credit impairment hit, while Qube Holdings and Worley flagged earnings impacts from the ​ongoing market volatility.

Australia's corporates are starting to count the cost of the war in the Middle East, with profit warnings from two top companies and a crash in business sentiment pointing to ‌pain from rising prices, raising the risk of stagflation, Reuters reported. The country's top airline Qantas Airways and second largest lender ‌Westpac Banking Corp flagged their earnings could be hurt by soaring fuel prices and the impact on customers, as feared by the country's central bank.

Australia's Federal Court has ordered Oztures Trading Pty Ltd, trading as Binance Australia Derivatives, to pay an AUD $10 million (about $6.9 million USD) penalty after the exchange admitted to exposing 524 retail investors to high-risk crypto derivative products without required consumer protections, Decrypt.com reported.

The Reserve Bank of Australia's latest Financial Stability Review indicates that total company insolvencies as a share of operating companies have stabilised over the past year, returning to their long-run averages, AccountingTimes.com.au reported. The RBA report said that easing cash flow pressures and recovering domestic demand have supported company viability. It noted that insolvencies saw a sharp increase in the years following the pandemic due to a catch-up effect from the exceptionally low number of insolvencies during the COVID-19 period, when temporary support measures were in place.

Australia and the European Union signed a free trade agreement on Tuesday after eight years of negotiations, removing tariffs on almost all goods and potentially easing EU access to Australian critical minerals, Reuters reported. However, some Australian agricultural exports, including beef and ‌sheep meat, will face quotas. Australian farmers criticised the pact for offering what they called "subpar" access to the bloc, while French farmers argued the ‌quotas were too generous. The deal follows intensified talks amid sharply higher U.S.