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”: