rThe New Zealand government should seriously consider adding a debt to income ratio instrument to the Reserve Bank of NZ's toolkit, said Acting RBNZ governor Grant Spencer yesterday.The new Labour-led coalition government is to review macroprudential policy, and the Reserve Bank Act and MOU (memorandum of understanding) between the government and the central bank.In a speech to the Institute of Finance Professionals, Spencer said the bank's loan to value "speed limit" restrictions, had been "a qualified success".The LVR restrictions were first put in place in October 2013 due to concerns about increasing risk in the housing market and a trending up of high-LVR lending by the banks."Our assessment is that the LVRs have had transitory effects on the rate of house price inflation but have had sustained beneficial effects on the resilience of banks' and households' balance sheets," said Spencer (who made it clear that the views in the speech were his own, not a formal RBNZ position). "The share of outstanding mortgages with an LVR greater than 80 per cent has steadily trended down as a result of the LVR policy, from 21 per cent in September 2013 to seven percent in December 2017.  Recent Reserve Bank estimates suggest that banks' credit losses from a severe housing downturn could be reduced by around 20 percent."  Spencer said he expected housing to be "an ongoing (but variable) source of systemic risk in the New Zealand financial system"."I expect that both LVRs and some form of debt servicing instrument will become part of the macroprudential 'furniture' over time.""I support retention of the four instruments listed in the MOU (LVRs, CCB, CFR, SCR) and the addition of a carefully designed debt to income (DTI) or debt servicing instrument."Whatever instruments are relevant for the toolkit through time, I believe the upcoming review should consider a structure for macroprudential instruments which allows them to be 'on' or 'off' through time, but where they remain established within banks' reporting and compliance systems."Macroprudential policy would adjust back to 'neutral' or non-binding settings when no heightened risk is present."