The additional capital requirements imposed on Australia's Big Four banks to bring them in line with the Basel Committee for Banking is damping down one important niche area of lending  - the construction finance sector. "These overriding regulatory requirements are not temporary responses to a specific event; they actually represent a permanent constraint on the banks which is impacting both their pricing and the terms and conditions being applied," said Daniel Holden, a director at the specialist construction finance group HoldenCapital, the largest construction finance broker in Queensland. Holden said that, while the Global Financial Crisis was underway, the major banks were allowed "to establish a stranglehold" on the Australian construction finance sector. In recent months, this has started to unwind. Holden added that the trend would be permanent. "While there is no doubt that as loans run off their book they will look to replenish, the reduced loan to value ratios and other more conservative terms and conditions are permanent changes to bank lending policies which will now fluctuate within certain lower risk parameters," he said. Holden said his firm of construction brokers was currently settling an average of more than one transaction per week - that is, one an apartment block or group of townhouses for example. But recently there had been "a noticeable change" in the ratio between the traditional bank-sourced debt, he said.   "Those alternative funding options now being opted for by developers who don't want to miss a market opportunity just because their banks have their own problems," Holden said. He noted that in the FY to 30 June 2015, his firm was involved in finance for A$300 million in loans, with around 66 per cent of that business going to the majors. In comparison, in the year to date with about 9 months' of data, the $300 figure has already been matched, as HoldenCapital heads towards an expected $380 to $400 million in new finance deals. What notable here is that Holden reckons only about half the previous ratio holds true here. That is, now only 33 per cent of his firm's business financing development is going to the majors. He suggests the Big Four have turned their back on many clients - to the obvious benefit of alternative lenders and second tier banks.