LVR data for March 2013

The RBNZ announced LVR (loan to value) restrictions will start on 1 October 2013. It will limit high LVR (over 80%) to 10% of new lending. Matt has already written about this.

This post adds some data for context. The following figures are from the March 2013 quarter General Disclosure Statements, published on each bank’s website. 

Note that the data are gross (that is net of repayments). I am sure each bank will vehemently deny these figures accurately reflect their position. But it is the best available.

Mortgage holdings, as at Mar-13  
  <80% LVR >80% LVR Total High LVR share
ANZ 40,454 11,661 52,115 22%
BNZ 27,160 4,777 31,937 15%
WBC 34,032 9,222 43,254 21%
ASB 35,740 9,722 45,462 21%
Kiwi 10,120 2,352 12,472 19%
Total 147,506 37,734 185,240 20%

Across the big four banks 15-22% of their books are in high LVR mortgages.

Mortgage growth, Mar-13 year    
  <80% LVR >80% LVR Total High LVR share
ANZ 1,388 2,022 3,410 59%
BNZ 844 462 1,306 35%
WBC 1,525 -1 1,524 0%
ASB 560 2,369 2,929 81%
Kiwi 726 1,797 2,523 71%
Total 5,043 6,649 11,692 57%

Of the growth in lending (net of repayments) some banks lent a lot more high LVR stuff than others. For example, Westpac slightly reduced its high LVR lending, while 81% of ASB growth was in high LVR.

If we hold the world constant, the $6.5b of high LVR lending growth over the past year will shrink to $0.6b.

Unless of course the economy is a real thing and not a static model. In which case lots of other things will adjust, like house prices, more lending at low LVR, mummy and daddy or other financial institutions topping up deposits, etc.

  • Holy fiat currency, Batman! We are going to lose ~$6b in new lending? That sounds like it might have a significant effect on consumer spending.

    • Shamubeel Eaqub

      I doubt it – its likely to be much smaller. The banks hide all their true new lending figures. The RBNZ is implementing policy on data they wont publish….but this is the only data that is available. In the interest of transparency this is a good first approximation until the powers that be release the required data for a reasonable discussion.