The Australian Prudential Regulation Authority (APRA) has published a frequently asked question (FAQ) for authorised deposit-taking institutions (ADIs) on the treatment of loans issued under the Federal Government's Family Home Guarantee (FHG) and First Home Loan Deposit Scheme (FHLDS) programs.
The FAQ clarifies the regulatory capital requirements for residential mortgage loans issued under both the FHG and FHLDS for ADIs that use the standardised and internal ratings-based approach to credit risk.
The FAQ also clarifies the correct reporting approach for entities that use the standardised approach to credit risk under Reporting Standard ARS 112.1 Standardised Credit Risk - On Balance Sheet Assets and Reporting Standard ARS 223.0 Residential Mortgage Lending.
The FAQ is available on the APRA website at: Calculation of credit risk weighted assets - frequently asked questions.
