National Australia Bank moves to slow lending to property sector
National Australia Bank (NAB) has echoed moves made by other Australian banks Commonwealth Bank and ANZ, by raising interest rates on interest-only home loans, a move aimed at slowing lending to Australia's property sector, following regulatory warnings; as such, interest rates have been raised by 0.29%. The Australian Prudential Regulation Authority (APRA) has required that banks slow their lending to the property sector to a growth rate of less than 10%.
National Australia Bank is raising interest rates on interest-only home loans, a move it says is aimed at slowing down housing investor credit growth and encouraging borrowers to pay down their debts.

The bank on Monday said it would raise interest-only rates by 0.29 percentage points, hot on the heels of Commonwealth Bank and ANZ Bank, which last week raised rates for investors by 0.27 percentage points.

NAB says interest-only loans were the "predominant structure for investors." Credit: Glenn Hunt

The change will mean NAB's standard variable home loan rate rises to 5.72 per cent for interest-only customers. It will affect both existing and new customers with interest-only loans and lines of credit.

Banks have said they are raising interest rates to comply with the Australian Prudential Regulation Authority's (APRA) requirement that housing investor credit growth slow to less than 10 per cent.