  High-value transactions between Australian banks are settled in the Reserve
Bank Information and Transfer System (RITS) administered by the Reserve Bank of
Australia. RITS operates on a real-time gross settlement (RTGS) basis and
settles payments sourced from the SWIFT, the Austraclear, and the interbank
transactions entered directly into RITS. In this paper, we analyse a dataset
received from the Reserve Bank of Australia that includes all interbank
transactions settled in RITS on an RTGS basis during five consecutive weekdays
from 19 February 2007 inclusive, a week of relatively quiescent market
conditions. The source, destination, and value of each transaction are known,
which allows us to separate overnight loans from other transactions (nonloans)
and reconstruct monetary flows between banks for every day in our sample. We
conduct a novel analysis of the flow stability and examine the connection
between loan and nonloan flows. Our aim is to understand the underlying causal
mechanism connecting loan and nonloan flows. We find that the imbalances in the
banks' exchange settlement funds resulting from the daily flows of nonloan
transactions are almost exactly counterbalanced by the flows of overnight
loans. The correlation coefficient between loan and nonloan imbalances is about
-0.9 on most days. Some flows that persist over two consecutive days can be
highly variable, but overall the flows are moderately stable in value. The
nonloan network is characterised by a large fraction of persistent flows,
whereas only half of the flows persist over any two consecutive days in the
loan network. Moreover, we observe an unusual degree of coherence between
persistent loan flow values on Tuesday and Wednesday. We probe static
topological properties of the Australian interbank network and find them
consistent with those observed in other countries.
