APRA on alert as owner-occupied competition heats up

by Julia Corderoy23 Oct 2015
Banking regulator APRA says it will remain “very alert” to decaying credit standards as competition for owner-occupied home loans heats up.

Appearing before the Senate Economics Legislation Committee in Canberra yesterday, APRA chairman Wayne Byres noted that while the banks had responded to its guidelines and reigned in investment lending, the growth in lending to investors had been offset by increased competition in the owner occupied market.

“Many of these changes have only recently come into effect, so we are watching carefully to see how they play through the system,” Byres said.

“Based on the latest available data, the rate of growth in credit for housing is, in aggregate, still accelerating. However, within this there is a compositional switch underway, as a moderation in the growth in lending to investors has been offset by somewhat stronger growth and more competition in lending to owner occupiers.”

As such, Byres said the regulator will be watching closely for any signs of declining lending standards.

“In such an environment, APRA remains very alert to any sign of deteriorating credit standards, and is monitoring that those ADIs identified as needing to strengthen their lending policies do indeed do so.”


  • by CJ 23/10/2015 8:56:04 AM

    Pull your head in APRA and stop making so many Knee-Jerk reactions. It's getting beyond a joke.

  • by GC 23/10/2015 9:09:48 AM

    APRA should be on "high alert" over this issue. They have had a major hand in creating this problem. The system wasn't broken so why did APRA need to intervene?

    The market was doing what it usually does every 10 yrs and the RBA and APRA screwed it up by sticking their noses where it didn't belong. Price increases would have slowed as they always do when the market decides enough is enough. Now its heading for some serious trouble. Is APRA now going to tell the banks and us they are lending too much and reduce lending levels?

    If this keeps going they will create one of the biggest credit squeezes we have ever seen and then the inevitable recession will follow. And who will be responsible for screwing the economy that up until now has been working fine? APRA, ASIC and the RBA.

  • by Regional Broker 23/10/2015 9:15:23 AM

    OH so has this so called decline in credit standards, resulted in a huge blow-out in mortgage loan arrears, or increases in LMI claims? NO.
    APRA is just so self focused and they need to back up these claims (scaremongering) with solid facts for more than one credible source.