Why regulators should be loan rangers

Regulators short on options have homed in on property loan-to-valuation ratios, but it's loan serviceability that should be in their sights.

Almost out of nowhere, it seems bank regulators are not just talking about macroprudential controls over bank lending but introducing them. There is now mounting pressure on the Australian Prudential Regulation Authority to follow suit.

Despite the host of new regulatory requirements imposing higher capital requirements, leverage ratios, tougher liquidity rules and the like since the global financial crisis, there is a significant push on for another layer of regulation.

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