NZ may tighten rules on property loans for investors

Wellington

NEW Zealand's central bank signalled it may tighten rules on lending to property investors in another attempt to cool a rampant Auckland housing market without raising interest rates. The local dollar fell.

The Reserve Bank of New Zealand (RBNZ) said on Thursday it is seeking views on how best to define property investment loans, which banks would be required to put into an asset sub-class and hold appropriate capital for those loans. The proposed rule amendment "is designed to ensure that banks hold adequate capital for the risks that they face from investment property lending", the RBNZ said in a statement.