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According to a recently released Merrill Lynch report, all of Australia’s banks have relaxed their lending criteria in recent months in a bid to attract a greater share of home loan customers.
The report argued that the relaxed lending could put home owners into trouble, as many will be allowed to borrow more than they could possibly repay.
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ANZ was judged to be the most aggressive lender, having relaxed its lending criteria significantly in the last few months to ensure new business streams through the door.
Merrill Lynch research analyst Matthew Davison said the strain on the household budget is too big to ignore and banks don’t accurately measure household costs.
An ANZ spokesperson rebuked the report’s findings and said the Merrill Lynch findings did not accurately reflect how much the lender was willing to lend.
The spokesperson told The Australian Financial Review that certain factors would be considered when assessing lending.
