The Australian banking regulator requires strict standards for mortgage lending.

Australia's banking regulator said on is mt5 foreign exchange platform reliableMonday that it will continue to maintain strict mortgage lending regulations due to ongoing concerns about the overall risk levels of the financial system, and considering the uncertain interest rate and economic outlook.

The Australian Prudential Regulation Authority (APRA) noted that geopolitical instability, household debt, and inflation above the central bank's target range make the outlook uncertain.

APRA Chairman John Lonsdale stated in a release: "Given the uncertain economic and interest rate outlook, including pressures from potential rising living costs, it is necessary to incorporate prudent buffer measures in the capacity-to-repay assessments."

The regulator will continue to require major lenders to use an interest rate at least 3 percentage points higher than the current mortgage rate when assessing new borrowers' ability to repay.

The countercyclical capital buffer will remain at 1.0% of risk-weighted assets, ensuring banks have additional capital buffers in times of stress.

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