Banks lend­ing with 10pc de­posit

South Waikato News - - NEWS -

The big banks ap­pear to be al­low­ing more home­buy­ers to bor­row with a de­posit of 10 per cent or less as their lend­ing books re­main stag­nant.

Quar­terly fi­nan­cial re­sults re­vealed this week by ASB Bank, Bank of New Zealand, West­pac and ANZ Na­tional Bank showed to­tal mort­gages were ei­ther flat or de­clin­ing across the board.

But the re­sults showed an in­crease in higher-risk lend­ing, with the banks lend­ing a higher per cen­t­age of a prop­erty’s value.

Mort­gage Bro­kers As­so­ci­a­tion gen­eral man­ager Jenny Camp­bell said some lenders were loos­en­ing cri­te­ria on dis­cre­tion for some in­di­vid­u­als, de­pend­ing on per­cep­tions.

‘‘Lend­ing teams are look­ing at deals very closely, and if you are a good cus­tomer, a good risk, you will get a deal,’’ Ms Camp­bell said.

None of the banks ad­mit­ted chang­ing their core lend­ing poli­cies but said they looked at loans in­di­vid­u­ally.

ASB ap­peared to have one of the most pro­nounced shifts into riskier lend­ing.

The bank’s mort­gage book was down by $ 38 mil­lion to $ 37.36 bil­lion in the three months to De­cem­ber, im­pacted heav­ily by a $584 mil­lion drop in loans be­low 80 per cent loan-to­value ra­tio.

How­ever, mort­gages with an LVR be­tween 80 and 90 per cent were up by $140 mil­lion and those with an LVR over 90 per cent had jumped by a mas­sive $406 mil­lion.

At West­pac, safer loans be­low 80 per cent were also on the de­cline, while riskier lend­ing above that thresh­old had in­creased by a to­tal of $ 143 mil­lion.

Fair­fax NZ News

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