Australian bank stocks have fallen recently due to various reasons. Income investors looking to hold these stocks for five years or more can consider adding them at current levels. From a Bloomberg article:

After losing A$57 billion ($44 billion) in market value, Australian bank stocks are starting to look more like, well, bank stocks.

Valuations on a gauge of the nation’s lenders are near the cheapest relative to the global average since January 2013. Just two months ago, they traded at the biggest premium since Bloomberg began compiling the data in 2005. The shares that led Australia’s six-year rally have slumped amid concern about heftier capital requirements, driving multiples on Commonwealth Bank of Australia and its three main peers in May to the lowest this year.

The four Australian banks trading on the US markets declined by 19% or more from their peaks since last year:

Compared to U.S. banks, Aussie banks have excellent dividend yields as shown in the table above. The Bloomberg article noted:

The S&P/ASX 200 Index has the highest forecast dividend yield among the world’s largest markets, data compiled by Bloomberg show. The 4.7 percent rate doesn’t include a tax advantage known as franking credits that boosts returns for domestic investors. The four largest lenders are all estimated to make payouts that top that level.

Source: Australian Banks Look a Lot More Like Bank Stocks After Drop, Bloomberg, May 26, 2015

Unlike most other countries, Australia does not impose dividend withhold taxes for U.S investors.This is one solid reason to include Australian banks in a diversified portfolio.

Tickers of banks mentioned: 

• Westpac Banking Corporation (WBK)
• National Australia Bank Limited (NABZY)
• Commonwealth Bank of Australia (CMWAY)
• Australia & New Zealand Banking Group Limited (ANZBY)

Disclosure: Long WBK and NABZY

Related:

• Australian Dividend Stocks Start to Wane, WSJ, June 1, 2015