The latest monthly banking stats from APRA shows that total lending for home loans by the ADI’s (banks, building societies, credit unions etc.) rose 0.5% in July, down slightly from the previous month. Within that loans for owner occupied loans rose 0.64% to reach $952.5 billion, and investment lending rose 0.3% to $527 billion. Loans for investment property now comprise 35.6% of outstanding loans. So the rate of loan growth is slowing, but the overall level of household debt continues to rise and investment loans are back in favour. Remember too that these numbers are still messed up with ongoing loan reclassification with $43 billion over the period of July 2015 to July 2016, of which $1.0 billion occurred in July.
Looking at individual lender movements, CBA lent more on both the owner occupied and investment side of the ledger.
As a result we see CBA lifting its market share, though Westpac still has a greater share of investment loans.
If we examine the relative growth of loan portfolios against the APRA 10% speed limit, most major players remain within the 10% target.
We will look at the RBA financial aggregates next, which gives us the view of all loans across the market, including the non-bank sector.
