APRA Releases Q4 2025 Lending Data — What Australia's ADI Statistics Reveal for Property Borrowers

APRA has today released its Quarterly Authorised Deposit-taking Institution (ADI) Performance Statistics and Quarterly ADI Property Exposures data for the December 2025 quarter. The data provides the most comprehensive picture yet of how Australia's regulated lending sector performed through the second half of 2025 — and signals key shifts relevant to property buyers and non-bank borrowers.

What APRA's ADI Statistics Cover

The quarterly ADI release covers all authorised deposit-taking institutions — the major banks, regional banks, credit unions, and building societies that fall under APRA's oversight. The report includes:

• Aggregate lending volumes by sector (residential, commercial, personal)
• Residential property exposures: LVR distribution, interest-only versus principal-and-interest split
• Loan impairment and arrears data
• Capital adequacy ratios for the banking system

The December 2025 quarter covers the period when the RBA began its rate-cutting cycle, with the first cut delivering a reduction from 4.10% to 3.85% in February 2026 having already been anticipated by markets.

Key Takeaways for Property Borrowers

While APRA's full data release will be analysed in detail over coming days, the quarterly statistics historically reveal patterns that matter to borrowers:

Lending concentration at the majors: The Big Four typically account for over 75% of all residential mortgage lending in Australia. When their credit standards tighten — as they have in a rising rate environment — the gap widens between what borrowers can access at a major bank versus a non-bank lender.

Interest-only lending trends: APRA's data tracks the share of interest-only loans in the system. Non-bank lenders like MPFG Capital offer interest-only structures more readily than regulated ADIs, making them particularly relevant for investors and developers.

High-LVR lending: APRA monitors loans above 80% LVR closely. For borrowers requiring higher leverage — or those with non-standard income — non-bank lenders often provide viable pathways that regulated banks cannot.

Why Non-Bank Lending Data Matters

It's worth noting that APRA's statistics cover only ADI-regulated entities. Non-bank lenders — which operate under ASIC oversight via Australian Credit Licences rather than APRA prudential standards — are not captured in this data set.

This means that a significant and growing portion of Australia's mortgage and commercial lending activity is invisible in APRA's quarterly figures. Industry estimates suggest non-bank lenders now account for approximately 7–10% of total mortgage originations nationally, with that share growing as bank credit conditions tighten.

Implications for Self-Employed and Alt Doc Borrowers

APRA's property exposure data will show the LVR and loan type distribution across the regulated sector. What it won't show is the volume of borrowers who were declined by ADIs and subsequently found approval through non-bank channels.

For self-employed borrowers, new migrants, and those with complex income structures, the story of Australia's credit market in 2025–2026 is only half-told by APRA's ADI statistics. The non-bank sector has absorbed significant demand overflow, particularly as major banks applied conservative serviceability assessments under APRA's 3% interest rate buffer requirement.

MPFG's Approach in Context

MPFG Capital operates outside the ADI framework, which gives us the flexibility to assess borrowers on their actual financial circumstances rather than standardised serviceability models. Our Alt Doc, commercial, and private funding products have been structured precisely to serve borrowers that the ADI sector — tracked by APRA — cannot efficiently accommodate.

As the full Q4 2025 data becomes available, we'll provide further analysis on what the trends mean for our borrowers and the broader non-bank lending landscape.

Source: APRA Quarterly ADI Statistics, December 2025 quarter, released 12 March 2026. This article is for informational purposes only and does not constitute financial advice.