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The Australian Prudential Regulatory Authority (APRA) has advised banks that it may implement tougher macro-prudential mortgage curbs if they don’t take action to rein-in higher risk lending.
APRA last month applied the brakes to higher-risk mortgage lending by requiring banks to use more cautious interest rate assumptions when assessing new customers.
Yesterday, APRA issued a media release and information paper outlining its “framework for using macroprudential tools to promote financial stability”:
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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.