Business lending growth outpaces mortgages at the banks

The Australian Prudential Regulation Authority (APRA) has released its monthly authorised deposit-taking institution (ADI) statistics for July 2022, showing that total residents loans and finance leases held by the banks increased by $14.6 billion (or 0.5 per cent) to $3.22 trillion in the month of July.

Looking at mortgages, owner-occupied lending increased marginally (0.3 per cent or $4.2 billion), while investor lending increased by 0.2 per cent ($1.4 billion) in July.

As such, the banks now have $1.3 trillion in owner-occupied mortgages on their books, and $666 billion in investor loans.

The Commonwealth Bank of Australia (CBA), continues to lead the pack for the largest owner-occupier loan book (totalling just over $346 billion in July), followed by Westpac ($280 billion), then National Australia Bank (NAB) at just over $193 billion and ANZ at $173 billion.

All four majors increased their owner-occupier books over July, but ANZ only marginally — by $141 million.

While the data showed that mortgage lending continues to grow at the banks (haven risen by 9.4 per cent — or $276.4 billion — for the year ended July 2022), business lending has been growing at a faster rate.

The July stats showed that bank lending to non-financial businesses increased by $5.2 billion, or 0.6 per cent, over the month.

“This is indicative of continued resilience of business conditions, despite headwinds from cost pressures and rising interest rates,” APRA noted.

The APRA figures also showed that credit card lending and personal lending dropped in July, decreasing by $0.6 billion (or 2.1 per cent) and $0.9 billion (or 1.2 per cent) over the month of July, respectively.

[Related: Spotlight: The rising demand for small-business finance]