Via Banking Day:
Australian Banking Association chief Anna Bligh has given a commitment that her organisation’s members will continue to provide support to customers affected by the pandemic when the current loan deferral arrangements end next month.
The ABA said banks were working directly with customers in hardship to work out an appropriate outcome.
Bligh said: “As deferrals and government support measures wind down, banks are reassuring their customers that continued tailored support is available to those who are still struggling.”
The ABA launched a new financial assistance hub. www.ausbanking.org.au/assistance
Drawing on data provided by the Big Four banks, the ABA said that 91 per cent of deferred loans have resumed repayments. Fewer than 80,000 loans remain on deferral, down from a peak of 800,000.
Among the four majors, 0.5 per cent of all their loan facilities are currently deferred.
Thirteen per cent of deferred housing loans and 5 per cent of deferred business loans are yet to resume repayments.
The Australian Bureau of Statistics also provided an update on developments in the mortgage market. It said that since March last year 13 per cent of home owners with a mortgage experienced a change to their loan repayments, either for their own home or for an investment property.
Of those whose mortgage repayments were changed, 86 per cent attributed the change to COVID-19.
Seven per cent had their owner-occupier mortgage payment deferred, 6 per cent had their owner occupier mortgage payments reduced, 1 per cent were in arrears at some point, 1 per cent had mortgage payments for an investment property deferred or in arrears and 1 per cent had mortgage repayments for an investment property reduced.
Over the same period 5 per cent of renters had their rent payments reduced at some point.
In December, 7 per cent of home owners with a mortgage reported stress related to difficulties paying for their home and 1 per cent reported stress related to difficulties paying the mortgage on an investment property.
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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