Research Radar: IO lending falls

Interest-only lending from Australian authorised deposit-taking institutions (ADIs) fell sharply in the June quarter.

"In flow terms, interest-only lending slowed to 30% of total new loans in the June quarter, down from 36% in Q1," Tom Kennedy, economist at JP Morgan noted.

"As a result, the stock of interest-only lending contracted for the first time since 2009, with aggregate interest-only lending values slumping by $2.3 billion."

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