By Gareth Vaughan
The Reserve Bank setting its high loan-to-value ratio (LVR) "speed limit" at 10% of new residential mortgage lending was lower than ASB had expected, CEO Barbara Chapman says, but the bank is now tracking at about 5%.
ASB was caught out last year after the introduction of LVR restrictions, meaning in late September it gave customers who had received pre-approvals for high LVR loans just days to draw them down or lose them. This earned the bank a public dressing down from Finance Minister Bill English, and mocking from ANZ CEO David Hisco who labelled the move "a bit of a brand disaster" for ASB.
Speaking after ASB posted its half-year results yesterday, Chapman told interest.co.nz the speed limit being set as low as 10% had been a surprise.
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