New Zealand's banks have already begun clamping down hard on mortgages with high loan-to-valuation ratios, ahead of the expected introduction of a "speed limit" on their growth by the Reserve Bank of New Zealand.RBNZ figures released this week show the value of mortgage approvals in the 13 weeks to July 12 was up just 3.2 per cent compared with the same period a year earlier. This is down sharply from the annualised growth seen in the 13 weeks before May 10 of 16.9 per cent."Banks have certainly toughened their decision making in recent weeks as they prepare for the Reserve Bank's restrictions," said Roost Mortgage Brokers' spokeswoman Colleen Dennehy.Roost's brokers had already seen some banks tighten their rules around credit criteria for loans with an LVR of more than 80 per cent in the last six to eight weeks, Dennehy said. This means borrowers with short-term debts are not being approved, nor are low equity premiums being waived.Hot competition between the banks around the merger of ANZ and the National Bank, which started in the middle of 2012 and continued through into early 2013, had seen low equity premiums (of between 0.5 per cent to 0.7 per cent) for mortgages with LVRs of over 80 per cent being waived to win market share. This was particularly the case for those in the 80 to 85 per cent bracket. Low equity premiums for LVRs of over 85 per cent had also been waived for some customers, along with legal fees, brokers said.Banks started applying low equity premiums to 80 to 85 per cent lending in June and early July, brokers said."That's disappeared now," Squirrel Mortgages' principal John Bolton said of the low equity premium waivers."The banks aren't competing that aggressively with each other above 80 per cent [now]," he said. "They have been tightening up their criteria for while."Brokers said the tightening began in late May and continued throughout June as the comments from the Reserve Bank about a 'speed limit' on high LVR mortgage growth became tougher. The Government and the Reserve Bank announced a memorandum of understanding concerning the use of so-called macro-prudential tools, including a high LVR speed limit, on May 16.Reserve Bank governor Graeme Wheeler said, on June 13, that the bank had been talking to the boards and managements of local banks to encourage them to slow the growth of such lending and to tighten up on lending criteria. On June 27, deputy governor Grant Spencer gave a tough speech laying the groundwork for a speed limit, including insisting the bank would not allow exemptions for first-home buyers.