26 May 2014
The Australian Prudential Regulation Authority (APRA) today released for consultation a draft prudential practice guide that provides guidance to ADIs on sound risk management practices for residential mortgage lending.
Residential mortgage lending has been a significant source of balance sheet growth and profitability for ADIs over a long period. Residential mortgages constitute the largest credit exposure in the Australian banking system and, for many ADIs, well over half their total credit exposures.
Draft Prudential Practice Guide 223 Residential Mortgage Lending outlines prudent practice in addressing housing credit risk within an ADI’s risk management framework, in applying sound loan origination criteria and appropriate security valuation methods, in the management of hardship loans and in establishing a robust stress-testing framework.
Draft Prudential Practice Guide 223 Residential Mortgage Lending can be found on the APRA website.
APRA welcomes comments on the draft prudential practice guide. Comments can be provided to email@example.com by not later than 21 July 2014 and addressed to:
Mr Neil Grummitt
General Manager, Policy Development
Policy, Statistics and International Division |
Australian Prudential Regulation Authority
Executive General Manager
Policy, Statistics and International