Mr Frydenberg urged banks to provide borrowers with “affordable and timely access to credit” amid new data from the RBA highlighting the slowdown in lending activity.
The annual rate of housing credit growth has dropped to the lowest level since 2012, according to the latest statistics from the Reserve Bank of Australia.
The rate of housing credit growth also slowed on a month-on-month basis, declining by 0.1 per cent from growth of 0.4 per cent in October 2018 to growth of 0.3 per cent in November.
The slowed month-on-month growth was driven by subdued investor lending activity, with Australia’s total investor portfolio unchanged at $593.7 billion. Conversely, the underlying owner-occupied lending portfolio increased by $4.6 billion, now totalling $1.21 trillion.
“Now that APRA’s interventions have been wound back, it is vitally important that the banks continue to provide affordable and timely access to credit, particularly as housing credit from banks has fallen to 4.4 per cent compared to its 10-year average of 8.1 per cent,” Mr Frydenberg said in a statement.
APRA, the banking regulator, has lifted its cap on interest-only lending. The cap saw interest-only loan approvals plummet across Australia, and most lenders operated well below the prescribed 30 per cent limit.