What Does APRA's Capital Add-On on ING Australia Mean for Borrowers?

Key takeaway: APRA has imposed a capital add-on on ING Australia after uncovering years of overstated liquidity ratios, a reminder that major bank balance sheets face growing regulatory scrutiny even as the cash rate holds steady.

A Major Bank Faces a Capital Penalty Over Liquidity Failures

APRA confirmed on 3 September 2026 that it has taken action against ING Australia for material liquidity breaches, after the regulator found the bank had overstated its liquidity ratios for years. Australian Broker reported the outcome as a capital add-on — effectively requiring ING to hold more capital against its balance sheet until it demonstrates the underlying issues are fixed. It is the kind of enforcement action that rarely makes front-page news outside the industry press, but it speaks directly to how APRA is treating liquidity and risk reporting across the banking sector in 2026.

Why Regulatory Scrutiny Matters for Everyday Borrowers

A capital add-on does not change a bank's advertised rates overnight, but it does add cost and caution to how that bank manages its lending book. Combined with the RBA holding the cash rate at 4.35% since 12 August 2026 and the economy growing just 0.4% in the June quarter, banks under regulatory pressure tend to have less appetite for complex or "non-standard" applications — exactly the kind self-employed borrowers and small business owners often submit.

"Regulator uncovers years of overstated liquidity ratios at major bank." — Australian Broker, September 2026

Non-Bank Lenders Operate on a Different Model

Non-bank lenders like MPFG are not authorised deposit-taking institutions and are not subject to the same APRA capital add-on regime that applies to banks such as ING. That does not mean less oversight — MPFG lends under its own Australian Credit Licence (ACL 553698) and is bound by responsible lending obligations — but it does mean lending decisions can be made on a case-by-case basis without the same balance-sheet constraints a bank under a capital add-on is managing.

What This Means for Borrowers

For self-employed clients, new migrants, or anyone who has faced a slow or cautious response from a major bank recently, incidents like the ING capital add-on help explain why. Banks tightening internal risk settings in response to regulatory action can mean longer processing times and more conservative servicing calculations, even for straightforward applications. MPFG's Alt Doc, refinance and commercial lending products are designed for borrowers who need a faster, more flexible assessment outside the traditional bank model. Every application remains subject to MPFG's own credit assessment.

FAQ

What happened between APRA and ING Australia?

APRA found that ING Australia had overstated its liquidity ratios for several years and responded with enforcement action, reported as a capital add-on requiring the bank to hold additional capital until the issues are resolved (Australian Broker, September 2026).

Does a bank capital add-on affect home loan approvals?

It can. Banks facing added capital requirements often tighten internal lending criteria and take longer to approve complex applications, even though advertised interest rates may not change immediately.

Why do self-employed borrowers often choose non-bank lenders like MPFG?

Non-bank lenders are not subject to the same APRA capital add-on framework as banks and can assess Alt Doc applications — based on BAS statements or an accountant's letter — on a case-by-case basis, often with faster turnaround than a major bank under regulatory scrutiny.

This article is general information only and does not constitute financial or credit advice. All applications are subject to credit assessment by MPFG Capital (ACL 553698).