From the reformed Micheal Pascoe today:
The reporting of banks being pulled into line on investor loans has concentrated on one part, re-establishing a differential between investor and owner-occupier rates without being able to spell out how big that differential might be. It won’t matter much anyway.
But there is considerably more to APRA’s intentions than that, as there needs to be. If APRA is serious about curtailing perceived investor excess, it has to do considerably more than force the banks to charge investors a little extra.
…In an under-reported speech earlier this month, APRA chairman Wayne Byres was talking about more direct curtailment of funds available to lend – and not just for investors.
Byres was clearly (well, clearly for APRA) telling the ADIs (authorised deposit-taking institutions) to lend less, not to charge a little more. That’s the pin he’s waving.
Byres recounted that the results of a hypothetical borrower survey put to ADIs were “quite enlightening for us – and, to be frank, a little disconcerting in places”.
…It seems much of the attention is still focussed on the 10 per cent benchmark and new bank capital requirements, missing the intent of making it harder for borrowers to borrow as much as they have been.
We won’t forget The Pascometer did its very bets to pump the bubble for the past few years but this new Michael Pascoe is still very welcome.