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Business loans on the rise while mortgage growth remains flat

Business loans on the rise while mortgage growth remains flat

Business loans on the rise while mortgage growth remains flat?w=400
Australian business loans growth accelerated in April as mortgage growth stayed consistent, with major banks growing at less than the system average according to latest RBA data.

The RBA reported that business lending grew at an annualised rate of 17% in April, up from 16% in March and 14% in February. Lending to large and medium-sized businesses grew while lending to small businesses hadn't changed much "for some time,” the RBA said.

In the past year, business services and finance firms have experienced above average growth. The rental, hiring and real estate sectors have been the main focus of business services firms during that time period.

According to Richard Wiles, analyst at Morgan Stanley, the major banks' mortgage portfolios grew at different rates. ANZ Banking Group grew its mortgage portfolio by 0.5%, Commonwealth Bank of Australia by 4.5%, National Australia Bank by 6.5% and Westpac Banking Corporation 1.5%.

BOQ grew at a similar rate to most other banks, Bendigo and Adelaide Bank had the largest growth with 11.5%.

APRA chairman, Wayne Byres, flagged earlier this week that Australia was on the brink of a “very different” lending environment than that seen over the last few decades. Byres said that Fixed-rate borrowers who were switching to variable rates faced a repayment shock, which would likely leave them in negative equity

Published:Thursday, 2nd Jun 2022
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