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The Australian Prudential Regulation......>

AUSTRALIA
AUSTRALIA: The Australian Prudential Regulation Authority (APRA) has announced
that it will proceed with proposed changes to its guidance on the serviceability
assessments that authorised deposit-taking institutions (ADIs) perform on
residential mortgage applications.
- In a letter to ADIs issued today, APRA confirmed its updated guidance on
residential mortgage lending will no longer expect them to assess home loan
applications using a minimum interest rate of at least 7 per cent. Common
industry practice has been to use a rate of 7.25 per cent.
- Instead, ADIs will be able to review and set their own minimum interest rate
floor for use in serviceability assessments and utilise a revised interest rate
buffer of at least 2.5 per cent over the loan's interest rate.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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