Almost 10% of all loans granted repayment deferrals
Close to 10% of total outstanding loans, cumulatively worth $274 billion, have been granted temporary repayment deferrals by deposit-taking institutions (ADIs), according to data from the Australian Prudential Regulation Authority (APRA).
Of that, housing loans which stood at $195 billion made up the majority of temporary relief to borrowers impacted by COVID-19, which allowed borrowers to defer their loan repayments for a period of time.
At the same time, small business loans which accounted for $55 billion of all outstanding loans, showed a higher incidence of repayment deferral with 17% of small business loans being a subject to repayment deferral, compared to only 11% of housing loans.
According to APRA, an overall composition of loan repayment deferrals remained relatively stable with the most noticeable change being increased loans exiting from repayment deferral, from $2 billion in May to $18 billion in June and the majority of these loans returned to a performing status.
However, the housing risk profile showed that housing loans granted repayment deferrals were more likely to be extended to owner-occupier borrowers, subject to principal and interest repayments, and had higher loan to value ratios than all housing loans.
Source: APRA
AUTHOR
Oksana Patron
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