SYDNEY: The International Monetary Fund has warned Australia may need to tighten rules on home loan lending and ensure banks have more capital to strengthen resilience against economic shocks, The Australian Financial review reported on Saturday.
IMF Deputy Managing Director Tao Zhang told the paper Australia’s housing-market vulnerabilities and its dependence on trade made it susceptible to global risk, including protectionist policies touted by US President-elect Donald Trump.
“We’re talking about prudential policies needing to be intensified, with targeted macroprudential measures and banks being encouraged to robustly increase their capital position,” Zhang said.
Concerns that parts of the Australian housing market are oversupplied have recently made some banks more cautious about lending to developers and buyers.
Published in Dawn December 4th, 2016
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