Vic narrows loan deferrals gap

The Australian Prudential Regulation Authority (APRA) has released figures around temporary loan repayment deferrals due to the coronavirus pandemic, which has shown that as at 31 January 2021, only 1.4 per cent of total loans are on temporary repayment deferrals totalling $37 billion.

This has reduced from $50 billion – or 1.9 per cent of total loans outstanding – in December 2020.

Housing loans have continued to comprise the majority of total loans granted repayment deferrals, with 1.8 per cent – or $32 billion – of total loans in deferrals.

Only 1.1 per cent of all small-to-medium enterprise (SME) loans totalling $3.6 billion have remained in deferral.

Victoria has continued to remain the state with the highest proportion of loans subject to deferral as the impacts of multiple lockdowns to contain the coronavirus have continued to linger, but the state is narrowing the gap with the rest of the country.

According to the data, 2 per cent of the loans in Victoria have continued to be subject to deferral, compared with 1.0 per cent in the rest of Australia.

Victoria has the highest number of both housing loans and SME loans still in deferral, at 3 per cent and 2 per cent, respectively.

Figures have shown that the number of deferred home loans in NSW as at 31 January was at 2 per cent, while it was at 1 per cent in all the other states and territories.

Only 1 per cent of all SME loans have continued to remain in deferral in all states and territories except Victoria.

Deferral exits have continued to outweigh new entries for the seventh straight month in January, with $14 billion in loans expiring or exiting deferral and less than $1 billion entering or being extended.

Among the major banks, the largest movement in new or extended deferrals was at ANZ at 4 per cent, while the largest movement in expired or existed deferrals was National Australia Bank (NAB) at 48 per cent.

Meanwhile, ANZ had the largest share of SME loan deferrals at 2.8 per cent, while the lowest was NAB at 0.3 per cent.

The largest share of housing loan deferrals was Westpac at 2.8 per cent, while NAB has recorded the lowest at 0.5 per cent.

[Related: Deferred loans dip below 2 per cent: APRA]

Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.

Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.