Restraint curbs business not investment lending
Bendigo and Adelaide Bank, and Suncorp Bank, are the only banks of note to have applied the brakes on mortgage lending over the months of April and May 2017, on the back of APRA's late March measures to curtail the supply in interest-only loans.The monthly banking statistics from the Australian Prudential Regulation Authority show mortgage lending across all APRA supervised banks increased by 0.6 per cent in May 2017 from April, and increased by 1.0 per cent over the two months to May.All major banks hugged or exceeded the system growth metric for the two months to May - even Westpac, which over April produced growth in mortgages that was 0.7 times system.As the one bank with a recent history of weighting its new lending toward interest-only loans, Westpac was seen as the bank most likely to grow less slowly than mortgage system growth over 2017 in order to conform to APRA requirements.Instead, it's the regional banks, Suncorp, and Bendigo and Adelaide Bank that have moderated growth in mortgages overall. Over the two months to May, Bendigo and Adelaide Bank reported growth of 0.3 per cent, around one third the system growth rate of 1.0 per cent. Over May alone, the bank's growth in mortgages was 0.1 per cent compared with wider growth of 0.6 per cent.Suncorp Bank was even more of a laggard over two months. Its mortgage book expanding by 0.2 per cent, though it lifted a little in May when the bank's home loan growth was 0.3 per cent, half of system.Over the two months since APRA set out its new lending targets, three of the big banks have exceeded system growth in mortgages, with ANZ up 1.3 per cent, NAB 1.2 per cent and Commonwealth Bank 1.1 per cent.It's on the business lending front that banks have pulled the leash, with a very slight decline in aggregate business lending by all banks in April 2017. CBA, Macquarie Bank and HSBC were among the banks to report declines in business lending over the month.