Aussie regulator caps new interest-only lending at 30% of total home loans

Sydney

AUSTRALIA'S banking watchdog on Friday launched a new salvo in its battle against speculative home lending and explosive house prices, though analysts were far from convinced the war was yet won.

The Australian Prudential Regulatory Authority (Apra) asked banks to limit new interest-only lending to 30 per cent of total new residential mortgage lending, from 40 per cent now. It also demanded that banks limit investor credit to "comfortably remain below" a previously set cap of 10 per cent annual growth.