The Australian Prudential Regulation Authority
("APRA") has recently released its latest quarterly
property exposure data for domestic and foreign Authorised
Deposit-taking Institutions ("ADI's").
Overall exposure to property
Aggregate lender exposure to all property increased by just
over 2.0% for the quarter and 7.4% compared to the June quarter
This increase in overall exposure was driven primarily by
residential lending, with overall commercial exposure declining
slightly (-0.2%) since the March quarter and experiencing
comparatively lower growth year-on-year (+4.4%).
Exposure to mainstream asset classes (office, retail,
industrial) declined during the quarter, with moderate growth
Despite the slight decline, aggregate commercial exposure
($223.66 billion) remains within 10% of the previous peak exposure
reached in March 2009 ($248.98 billion).
Growth in exposure to development and subdivisional land
(+16.5%) and other residential development (+10.9%) continued to
increase significantly year on year.
Around 17% of commercial property exposure is to assets outside
Australia, in line with the long-term trend.
Impairments on commercial lending continued to decline, to 0.6%
of aggregate exposure. Notwithstanding, specific provisioning
against impairments remains historically high at 36%.
The number of loans held and total exposure to the residential
sector continues to increase steadily to 85% of all property
Recent measures to dampen growth in residential investor loans
have not yet generated a material impact.
Exposure to owner-occupiers still dominates at 61% of overall
residential exposure, but has declined over the last 12 months from
Growth in loans to investors remains significant, growing by
18.6% year on year.
The majority of new residential loans have been in the 60% to
80% LVR segment, equating to 54% of new residential loans in the
Change in property exposure by sector
Property exposure by lender group
Aggregate residential property exposure by type
New residential loans approved per quarter by LVR
Commercial property exposure by sector
Commercial property impairment
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guide to the subject matter. Specialist advice should be sought
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