Bank customers are still seeking mortgage 'holidays' and reduced loan repayments even as we start to head towards the planned end of the mortgage deferral scheme that was announced in late March at the time of the lockdown. But the numbers have come down compared with the huge numbers seen then.
The data shows that in the week ending July 17 banks had 407 requests (involving around $120 million of debt) for mortgage deferrals and there were 887 loans (totalling $278 million) that were restructured to interest only.
This of course though is a far cry from the early days after the announcement of the six month mortgage 'holiday' on March 24.
The RBNZ data shows that in the week to March 27 banks received 2,644 requests for mortgage payment deferrals. The number of requests shot up to 18,057 the following week and then 28,455 in the week leading up to Easter. The numbers have declined from then, and the 407 in the week to July 17 was in fact the lowest total, with RBNZ saying numbers have averaged around 500 a week in the past six weeks.
Likewise there was a huge surge of activity around restructuring of loans to interest only from the end of March and into early April, with 17,351 loans switching to interest only in the week to April 3 and then a peak of 19,933 the following week. While the numbers of people going to interest-only have reduced, there has continued to be a steady stream and in fact till the week ending July 17 the numbers in recent weeks had been increasing to in excess of 1000 per week.
According to information collected by the NZ Bankers Association, as at the end of June around 15% of New Zealand's mortgages by value were either on deferred payment or reduced payment. Some 79,175 customers with loans totalling $24 billion were on reduced payment terms, while 59,891 customers with $20.2 billion in mortgages were on the six-month 'holiday'.
Of course the ending of the mortgage holiday in September will coincide with the ending of the extended wage subsidy, which could prove problematic for some customers. The RBNZ has indicated it could consider extending the deferral scheme, though it does apparently have other options it could look at as well.
The RBNZ says the data it has started publishing weekly is collected "to obtain bank customer lending metrics on a timely basis in relation to the Covid-19 impact on the banking sector.
"The collection was set up to support prudential monitoring of the banking sector."
While the RBNZ has set up a new weekly survey to collect this data, "we do not intend it to be a permanent addition to our suite of surveys".
"The frequency and content of this survey will be reviewed on an ongoing basis."