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A not so merry Christmas? – Lending growth slows

Despite the recent mini boom in home prices, higher auction clearance rates, and bullish media commentary, the sentiment is simply not showing up in credit statistics released today.

Investor home lending growth is slightly in negative territory and personal credit growth is further accelerating its decline with negative 4.74% annual growth. Business lending growth is running at 2.68% at the end of October, down from 4% growth in June.  Owner-Occupied growth has steadied with a slight uptick at 4.79% growth.

Annual GST revenue is also experiencing rolling 12 months decline in growth.

Drilling down into the individual banks, Westpac is fairing the worst. Their Owner-Occupied loans fell by $280m in the last 3 months, and their Investor loans fell by $3.3 Billion or 1.8%.

Similarly, in the last 3 months, NAB home loans fell by $420 million, with investor loans down $2.3 billion or 2% and Owner-Occupied up $1.9 billion. CBA showed the strongest performance with $4.2 billion Owner-Occupied loan growth since July.

Overall, it still doesn’t look like being a great retail Christmas.

Michael Cornips

Michael Cornips is the Managing Director and Founder of Emerald Financial.

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