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The Australian Prudential Regulation Authority (APRA) has updated its expectations for sound residential mortgage lending practices for authorised deposit-taking institutions (ADIs) following consultation with industry and other stakeholders.
APRA released for consultation a revised draft of Prudential Practice Guide APG 223 Residential Mortgage Lending in October 2016 to incorporate measures previously announced by APRA in 2014 or communicated to ADIs since that time.
The revisions to APG 223 are designed to ensure that the sound lending practices that have been implemented across the industry since late 2014 are maintained and reinforced.
As a result of the consultation, APRA has made a small number of refinements to the prudential practice guide, which are explained in a letter to ADIs released today. APRA does not expect these refinements to result in material changes to existing lending practices across the industry as a whole.
APRA is continuing to maintain its close monitoring and supervision of residential mortgage lending practices, including growth in investor lending, as part of its broader mandate to build resilience in the financial sector and promote financial system stability.
The final APG 223 and the response letter are available on the APRA website at: www.apra.gov.au/adi/PrudentialFramework/Pages/APG-223-Residential-mortgage-lending-response-Feb2017.aspx
