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The Australian Prudential Regulation Authority’s (APRA) latest monthly banking statistics have revealed that the Commonwealth Bank of Australia (CBA) and its subsidiary, Bankwest, reported mortgage portfolio growth of $1 billion (0.2 per cent) in the month to 28 February 2019.
CBA’s portfolio growth was entirely driven by a 0.3 per cent rise in its owner-occupied book, which increased from $294.7 billion (as at 31 January 2019) to $295.7 billion. The bank’s investment home loan portfolio remained stable at $132.9 billion.
The Commonwealth Bank’s mortgage growth eclipsed that of its big four peers, with its nearest competitors, Westpac (and its subsidiaries), reporting portfolio growth of $400 million (0.1 per cent), followed by NAB ($300 million/0.1 per cent).
Westpac’s growth was also entirely driven by an increase in its owner-occupied book, which rose by 0.1 per cent, from $261.1 billion to $261.5 billion. Westpac’s investment portfolio remained stable at $152.3 billion.
Owner-occupied lending growth also drove NAB’s mortgage portfolio growth, with its owner-occupied book increasing by $400 million (0.2 per cent) in the month to 28 February 2019, from $155.3 billion to $155.7 billion.
NAB’s owner-occupied growth was offset by a $100 million decline (0.1 per cent) in its investment portfolio, which fell from $105.7 billion to $105.6 billion over the same period.
ANZ was the only big four bank to report an overall drop in its mortgage portfolio, which fell for the second consecutive month, declining by $400 million (0.1 per cent), from $258 billion to $257.6 billion.
In contrast to its peer banks, movement in ANZ’s mortgage book was solely driven by investor lending activity, with its investment portfolio falling by $400 million (0.5 per cent, from $79.3 billion to $78.9 billion. ANZ’s owner-occupied book remained stable at $178.7 billion.
ANZ CEO Shayne Elliott recently acknowledged that credit tightening measures imposed by the lender off the back of scrutiny were “overly conservative”.
Last week, Mr Elliott told the House of Representatives’ standing committee on economics that, in his view, tighter lending standards triggered the overall downturn in the credit market.
The weakened demand for housing credit was reflected in APRA’s latest property exposure data, which reported a $25 billion drop in home lending across Australia’s banking sector in the 12 months to 31 December 2018.
APRA’s monthly banking statistics coincided with the release of the Reserve Bank of Australia’s (RBA) Financial Aggregates data, which reported housing credit growth of 4.2 per cent in the month to 28 February 2019, 0.3 per cent higher than in the month to 31 January 2019.
However, when assessed on an annual basis, housing credit growth was 2 per cent slower than the previous corresponding period, dropping from 6.2 per cent growth in February 2018 to 4.2 per cent growth in February 2019.
The RBA data also revealed that business lending grew by 5.3 per cent in the month to February 2019, up 1.9 per cent from 3.4 per cent growth in February 2018.
Conversely, personal lending fell 2.7 per cent in February 2019, 1.6 per cent sharper than the decline of 1.1 per cent in the previous corresponding period.
The RBA reported total credit growth of 4.2 per cent over the same period, down 0.7 per cent from growth of 4.9 per cent in the previous corresponding period.
[Related: Banks triggered credit downturn, concedes ANZ CEO]
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