Investment lending remains within APRA limits

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Despite a small month-on-month increase over November, the annual growth of loans to property investors remains well below the 10% limit mandated by the Australian Prudential Regulation Authority (APRA).

According to the most recent banking statistics from the regulator, the value of property investment lending by Australian banks rose to $517.4 billion over November.

That represents a 0.14% increase since October, which had the lowest amount of investment lending by Australian banks since February 2015.

While the total value of investment loans may have increased over the month, the annual growth of investment lending decreased during the year to November.

According to APRA’s figures, investment lending grew by 3.32% in the 12 months to November, a fall from the 4% year-on-year growth recorded in October.

The latest figures from APRA also show that three of Australia’s Big Four banks have managed to bring their investment lending books in line with the regulator’s requirements.

According to the November figures, the National Australia Bank is the only major lender which saw its investment loan book grow by more than 10% in the year to November.

In the 12-month period, NAB’s investor lending grew by a $10.6 billion, a 12% yearly rise.

The nation’s biggest lender to investors, Westpac, performed better in the year to November as its lending to investors decreased by 8%.

Despite the yearly decrease, worth $12.14 billion, Westpac’s $135.37 billion investment loan book is still easily the country’s biggest, 6% larger than that of the Commonwealth Bank of Australia and 42% larger than NAB’s.

In the year to November, CBA issued $5.96 billion in loans to property investors over the year to November 2015, growing its investment book by 4.9%.

Over the 12 months ANZ saw its investment book increase 6%, with the bank writing $4.72 billion worth of investment loans.

Non-major lender AMP, which controversially left the investment market in July before announcing its return in November, decreased the value of investment loan book by 2% in November after settling $56 billion of investment loans less than October.

Over the year to November, the non-major increased its investment loan book by 5.9%. 

The total value of lending to owner-occupiers increased by 1.2% over the month of November and 12% over the year to November.

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