Australian Banks APRA Mar-26 property stats, inaugural system-wide stress test, consultation on standardised risk weights

Research evidence excerpt

Australian Banks APRA Mar-26 property stats, inaugural system-wide stress test, consultation on standardised risk weights

J P M O R G A N Asia Pacific Equity Research

03 July 2026

Australian Banks

APRA Mar-26 property stats, inaugural system-wide

stress test, consultation on standardised risk weights

There were several releases this week from APRA, including: 1) APRA property Australia

statistics for the Mar-26 qtr (which showed high-risk housing flows broadly

stable); 2) Results released for the inaugural system-wide stress test (with the bank

sector achieving a pass mark despite likely dipping into liquidity buffers in a stress Andrew Triggs AC

event); and 3) APRA consultation on amendments to the standardised risk weight (61-2) 9003-8919

andrew.triggs@jpmorgan.com

regime (with little impact on the majors given the standardised floor is not currently

Kelsey Bentley

binding). This week’s data showed small increases in new interest-only lending (61-2) 9003 7482

and exceptions to serviceability. High DTI loans for the majors remain well below kelsey.bentley@jpmorgan.com

the 20% limit that APRA introduced last year and investor lending decreased. Non- J.P. Morgan Securities Australia Limited

performing CRE loans declined again. We think material economic stress is yet to

come and forecast BDD/GLA of 10bps for the majors in FY26, rising to 12bps in

FY28, allowing for some deterioration in asset quality and partial utilisation of

collective provision buffers. Separately, APRA’s inaugural System Risk Stress

Test found banks would likely be broadly resilient to the modeled severe stress

event, managing liquidity stress by monetising liquid assets, using RBA repo and

drawing on domestic capital to support equity raisings. Finally, APRA is