Loan-to-value restrictions effective but have some drawbacks - RBNZ

Wed, 22 May 2019

By Rebecca Howard May 22 (BusinessDesk) - New Zealand's loan-to-value ratio restrictions have been effective in improving financial stability but the policy comes with drawbacks, says the Reserve Bank after a detailed review. “By improving the resilience of both households and banks, LVR policy has played a useful role in promoting financial stability during a period of heightened housing market risks,” deputy governor and head of financial stability Geoff Bascand said. The findings form part of a wider review of macroprudential policy....

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