Resident loans aiding lending growth amid tight times: APRA

The Australian Prudential Regulation Authority (APRA) has released its monthly authorised deposit-taking institution (ADI) statistics for September 2022.

They showed that total residents loans and finance leases increased by $23.5 billion (or 0.7 per cent) in September and by $291.2 billion (or 9.8 per cent) for the year ended September 2022.

According to the regulator, the above monthly increase "indicated credit growth remained robust despite monetary policy tightening".

Overall, the increase was "primarily driven by a $15.7 billion (or 1.7 per cent) increase in loans to non-financial businesses, followed by a $6.5 billion (0.5 per cent) increase in loans to owner-occupied housing," it explained.

The trend continued in the area of investment housing lending, which increased by $1.5 billion (or 0.2 per cent) in September, the data showed.

Over the year ended September 2022 it increased $35.9 billion (or 5.7 per cent), it confirmed.

Lending to financial institutions, though, declined by $0.7 billion (or 0.4 per cent) in September, marking the first month of decline since August 2021, APRA highlighted.

It context, six consecutive Reserve Bank of Australia (RBA) cash rate hikes had underlined the trajectory of the increases in the quest to rein in inflation. May was the first 25 basis-points jump for the year. Since  June, July, August and September the RBA has delivered 50-bp hikes.

For the year ended September 2022, the trend is positive with lending to financial institutions having increased by $31.3 billion (or 25.2 per cent).

Interestingly as an aside, credit card lending increased by $0.2 billion (or 0.6 per cent) in September whilst other household lending (eg. fixed-term personal loans) decreased by $0.5 billion (or 0.6 per cent), APRA stated.

Overall, banks now have $1.36 trillion in owner-occupied mortgages on their books and $670.02 billion in investor loans.

Looking at owner-occupied mortgages for the majors, for September Commonwealth Bank Australia (CBA) recorded a $350.18 billion loan book, followed by Westpac on $283.7 billion, NAB with $194.9 billion and ANZ on $174.8 billion.

[Related: Banks report lending growth amid rate hikes]