APRA releases quarterly authorised deposit-taking institution statistics for March 2021

The Australian Prudential Regulation Authority (APRA) has released the Quarterly Authorised Deposit-taking Institution (ADI) Performance and the Quarterly Authorised Deposit-taking Institution Property Exposures publications for the quarter ending March 2021.

Measures of ADI industry resilience were strong in the March 2021 quarter. Across the industry, ADIs held strong capital, liquidity and funding positions. Industry profitability improved moderately over the past year, as ADIs had significantly reduced charges for bad or doubtful debts. Moderate ADI credit growth over the quarter was largely driven by increased residential mortgage lending, in particular by owner-occupiers. The share of new higher-risk residential mortgage lending across most key metrics (for example, lending at high loan-to-valuation ratios) declined over the quarter, however the share of new lending at high debt-to-income ratios increased, with interest rates at very low levels. Key measures of asset quality, such as non-performing loan ratios, were stable, but the outlook is uncertain due to the expiry of repayment deferrals and some income support measures at the end of March.

The Quarterly ADI Performance publication contains information on ADIs’ financial performance, financial position, capital adequacy, asset quality, liquidity and key financial performance ratios.

Key statistics for ADIs1 for the March 2021 quarter were:

March

2020

December

2020

March

2021

Quarter on Quarter

Change

Year on Change

Net profit after tax (year-end)

$28.3 billion

$21.9 billion

$29.4 billion

+34.0%

+3.8%

Total assets

$5,599.2 billion

$5,302.3 billion

$5,206.8 billion

-1.8%

-7.0%

Total capital base

$340.2 billion

$369.0 billion

$378.1 billion

+2.5%

+11.1%

Total risk-weighted assets

$2,161.9 billion

$2,100.6 billion

$2,073.6 billion

-1.3%

-4.1%

March

2020

December

2020

March

2021

Quarter on Quarter

Change

Year on Year Change

Capital adequacy ratio

15.7%

17.6%

18.2%

+0.7% percentage points

+2.5 percentage points

Minimum liquidity holdings ratio

18.1%

20.2%

19.7%

-0.5% percentage points

1.6 percentage points

Liquidity coverage ratio

150.3%

141.8%

131.2%

-10.6 percentage points

-19.0 percentage points

March

2020

December

2020

March

2021

Quarter on Quarter

Change

Year on Year Change

Impaired assets and past due items2

$33.8 billion

$36.4 billion

$37.3 billion

+2.5%

+10.2%

The Quarterly ADI Property Exposures (QPEX) publication contains data on commercial and residential property exposures, including detail on risk indicators, serviceability characteristics and non-performing loans.

Key statistics for ADIs conducting residential mortgage lending for the quarter were3:

March

2020

December

2020

March

2021

Quarter on Quarter

Change

Year on Year Change

Residential mortgages – credit outstanding

$1,835.2 billion

$1,878.5 billion

$1,900.5 billion

+1.2%

+3.6%

of which: Owner-occupied

$1,117.8 billion

$1,177.6 billion

$1,200.4 billion

+1.9%

+7.4%

of which: Investment

$614.6 billion

$609.6 billion

$610.9 billion

+0.2%

-0.6%

Residential mortgages – credit outstanding

March 2020

(share of total)

December 2020

(share of total)

March 2021

(share of total)

Quarter on Quarter

Change

Year on Year Change

Owner-occupied

62.7%

64.2%

64.6%

+0.4 percentage points

+1.9 percentage points

Investment

34.5%

33.2%

32.9%

-0.3 percentage points

-1.6 percentage points

Interest-only

17.4%

14.5%

13.9%

-0.6 percentage points

-3.5 percentage points

LVR ≥ 90 per cent

4.8%

4.8%

4.7%

-0.1 percentage points

Unchanged

Non-performing

0.9%

1.0%

1.1%

Unchanged

+0.1 percentage points

March

2020

December

2020

March

2021

Quarter on Quarter

Change

Year on Year Change

New residential mortgage loans funded during the quarter

$94.6 billion

$128.1 billion

$127.2 billion

-0.8%

+34.4%

New residential mortgage loans funded during the quarter

March 2020

(share of total)

December 2020

(share of total)

March 2021

(share of total)

Quarter on Quarter

Change

Year on Year Change

Owner-occupied

68.5%

69.8%

69.9%

+0.1 percentage points

+1.5 percentage points

Investment

29.7%

28.6%

28.6%

Unchanged

-1.1 percentage points

Interest-only

18.1%

19.4%

19.5%

+0.1 percentage points

+1.3 percentage points

LVR ≥ 90 per cent

9.9%

11.3%

10.4%

-0.9 percentage points

+0.5 percentage points

Third-party originated

51.1%

54.6%

54.0%

-0.7 percentage points

+2.9 percentage points

Debt-to-income ≥ 6x

16.3%

17.3%

19.1%

+1.8 percentage points

+2.7 percentage points

Key commercial property statistics for ADIs for March 2021 were:

March

2020

December

2020

March

2021

Quarter on Quarter

Change

Year on Year Change

Total commercial property limits

$353.4 billion

$359.1 billion

$362.4 billion

+0.9%

+2.6%

Total commercial property exposures

$301.6 billion

$302.7 billion

$305.4 billion

+0.9%

+1.3%

Copies of the March 2021 publications are available at: Quarterly authorised deposit-taking institution statistics.


Footnotes:

1Excluding ADIs that are not banks, building societies or credit unions.

2Repayment deferrals may have dulled the anticipated deterioration in asset quality.

3See Explanatory Notes of QPEX for details of share calculations

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