People generally have a good grasp of their banking products and services according to data insights released by the New Zealand Bankers’ Association today.
“We were delighted to see people using home loans and credit cards to help get ahead financially,” says New Zealand Bankers’ Association chief executive Roger Beaumont.
“Around 44 per cent of people with a home loan are ahead on their repayments. That’s likely because, as interest rates have declined over the last few years, they may have retained their repayments at the same level. Depending on their loan, others may have increased their repayments further to get ahead and repay their loan more quickly. This shows good financial capability among people with home loans. It also means they’re quite well placed in an environment of rising interest rates.
“New Zealanders have a strong fascination with the housing market so it’s interesting to see that for the 1.2 million customers who have a home loan, the average value of those loans is $296,000. Around 56,000 new homes loans were written from July to December last year, and around a quarter of those loans were for first home buyers.
“People with credit cards also look financially savvy, with 68.5 per cent of cards fully paid off in the interest-free period, without incurring any interest cost. That shows most people with credit cards know how they work and how to get the most out of them.”
These, and other retail and small business banking insights, are available here: https://www.nzba.org.nz/wp-content/uploads/2022/05/Retail-and-small-business-banking-insights-July-to-December-2021.pdf.
The information relates to the six months from July to December 2021 and was collected and aggregated from NZBA’s 10 main retail member banks.
ENDS
Banks are in very early stage talks with the Government about potentially providing investment funding through a Business Growth Fund announced in Thursday’s Budget to support small and medium sized enterprises, the New Zealand Bankers’ Association says.
“Discussions with some banks on a potential Business Growth Fund are at a very early stage. No agreements or commitments to participate have yet been reached.”
‘Not good enough’ is the summation of the Bankers’ Association when it comes to the Government’s tweaks on the CCCFA. Chief executive Roger Beaumont joined Mike Hosking.
External Reporting Board (more…)
“The Government’s tweaks to the CCCFA lending rules announced in March are just a band aid. We don’t think the tweaks will make a big difference for most borrowers. That’s because most of the existing requirements remain in place, meaning customers will still have to provide detailed information about their spending, resulting in a more painstaking process and more loan applications being declined than before the December rule change.”
Ministry of Business, Innovation and Employment (more…)
The New Zealand Bankers Association said 44 per cent of people with home loans were ahead and paying more than the minimum in repayments. About 1.2 million Kiwis currently had a mortgage.
“The new rules have a one-size-fits-all approach for all lenders and all loan types and values, which has seriously impacted people applying for home loans. The new rules require banks to collect and verify much more information from customers, and the prescriptive approach means banks don’t have the same discretion or flexibility they used to.”
Reserve Bank of New Zealand (more…)