Bank of Queensland chairman Roger Davis says the lender is cautious over the state of the Australian housing market, with concerns emerging in its key Brisbane market.
With property prices continuing to climb in many areas, Mr Davis said it was possible that some east coast markets were now fully priced and told the bank's annual general meeting on Wednesday that settlements were becoming a concern.
"Current residential real estate prices, both single and multi-dwelling, remain high, predicated on continued strong immigration levels, traditional supply shortages in the Eastern states, low unemployment and 'lower for longer' interest rates," Mr Davis said.
"However, arguably a looming 'settlement bulge' in Melbourne and closer to home, in Brisbane, is creating an identifiable stress point in the economy which needs to be closely monitored."
The Reserve bank last month warned that the risks from apartment oversupply in those markets was already starting to show, with off-the-plan sales failing to settle due to tighter lending standards for overseas buyers and valuations at settlement dipping below contract price.
Mr Davis also warned that headwinds faced by the big four banks - such as funding costs, low interest rates and slowing credit growth - would affect Bank of Queensland's performance.
The Brisbane-based bank's cash profit rose for a fourth straight year in 2015/16, but only by one per cent to $360 million.
"Our future is influenced by the general economy we operate in and, whilst a rising tide lifts all boats, you can't swim for long against an ebbing tide," Mr Davis said.
"It is therefore important to note that Australia's transition from a resources led growth phase to one predicated on services, exports and construction, will take time - especially in the wake of broader global volatility."