APRA waves macroprudential stick at banks

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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