ASB shut down new build investor loans

The big four bank has stopped granting loans to investors for new properties unless they have a 40% deposit. The decision comes amid a wider clampdown on investor activity.

Advisers report that ASB has taken the decision in recent weeks. It comes after the Reserve Bank imposed a new 60/5 rule for lenders, meaning they cannot lend more than 5% of their book to investors with less than a 40% deposit. 

ASB executive general manager retail banking Craig Sims told the NZ Herald it would lend up to 60% to investors, regardless of whether the home was new or not.

"We are concerned the continued high levels of investor demand are unsustainable and we are focused on ensuring a balanced and sustainable housing market, which is in the best interests of all New Zealanders," Sims said.

Sims said ASB would allow lending above 80% LVR to owner-occupiers for construction purposes.

TMM Online has asked ASB for further comment.