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ANZ doesn’t expect low equity problems

ANZ says it is “extremely unlikely” that its customers will go above 95% LVR or into negative equity during the Covid-19 crisis.

Tuesday, April 14th 2020, 9:42AM

The virus outbreak has sparked fears that some borrowers could be pushed into low equity situations. House prices could fall by as much as 7% in the second half of this year, according to Westpac economists.

More than 68,000 homeowners have asked for mortgage assistance during the crisis, according to 1 News. A third of those have asked to defer payments.

Those deferring interest payments will see their mortgage balances increase, putting high LVR borrowers under pressure.

Yet ANZ believes existing LVR restrictions have left New Zealand’s banks on a sound footing to weather the Covid-19 storm.

A spokesman said: “As ANZ and other banks have been operating under the RBNZ’s LVR restrictions for some time, the number of customers with current LVRs greater than 90%, for example, is relatively small, and often these customers will be in a stronger financial position.

“We believe the likelihood of customers going above 95% or even into negative equity is extremely unlikely. The increase to the outstanding balance on an average loan is unlikely to make a material difference to their LVR position.”

The spokesman said ANZ would continue to work with the Reserve Bank on loan repayment deferrals. The bank says borrowers should “carefully” consider actions that may increase their mortgage balance.

“It’s important to recognise though that loan repayment deferrals are available to eligible customers who may have a range of LVRs, as well as owner-occupied or residential investment properties. We already operate comfortably below the RBNZ’s LVR restrictions.”

Tags: ANZ Lending LVR mortgages

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Lender Flt 1yr 2yr 3yr
AIA 4.55 3.19 3.19 3.49
AIA Special - 2.69 2.69 2.99
ANZ 4.44 3.15 3.25 3.85
ANZ Special - 2.65 2.75 3.35
ASB Bank 4.45 3.19 3.19 3.49
ASB Bank Special - 2.69 2.69 2.99
Bluestone 4.44 4.44 4.44 4.44
BNZ - Classic - 2.65 2.69 2.99
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.25 3.29 3.59
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union South 5.65 4.75 4.75 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 4.35 4.45 -
HSBC Premier 4.49 2.60 2.65 2.80
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 3.99 2.58 2.68 2.79
Kainga Ora 4.43 3.29 3.39 3.85
Kiwibank 3.40 3.40 3.54 4.00
Kiwibank - Capped - - - -
Kiwibank - Offset - - - -
Kiwibank Special 3.40 2.65 2.79 3.25
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Lender Flt 1yr 2yr 3yr
Resimac 3.49 3.45 3.39 3.69
SBS Bank 4.54 3.29 ▼3.19 ▼3.49
SBS Bank Special - 2.79 ▼2.69 ▼2.99
The Co-operative Bank - Owner Occ 4.40 2.79 2.79 3.39
The Co-operative Bank - Standard 4.40 3.29 3.29 3.89
TSB Bank 5.34 3.59 3.49 3.79
TSB Special 4.54 ▼2.65 2.69 2.99
Wairarapa Building Society 4.99 3.75 3.99 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - ▼2.65 2.69 2.79
Median 4.55 3.22 3.22 3.44

Last updated: 3 July 2020 8:15am

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