RBA FSR: Supervision of lending standards should cool down home prices

FXStreet (Bali) - In today's Financial Stability Review report, the Reserve Bank of Australia (RBA) noted that supervision of lending standards should help cool down rising home prices, adding that some banks are likely to have to reduce their lending activity, Reuters reports.

Key headlines - Reuters

Important bank lending standards in mortgage market do not decline

Have not seen any material loosening in lending standards so far

Regulators monitoring array of information to ensure mortgage risks do not grow

As a result, some banks likely to tighten standards and slow investor home lending

Banks' asset risks in commercial property sector have been growing

Foreign demand, global search for yield driving up prices in commercial, apartment markets

Australian financial system strong, bank assets improving and profits robust

Profile of new lending suggests households well placed to service their loans

Interest only loans an area of concern, asic currently reviewing standards

Measures of overall household financial stress remain low