According to Standard & Poor’s Performance Index, a total of 1.14 per cent of Australian mortgages underlying prime residential mortgage-backed securities were more than 30 days in arrears in September.
Arrears, including capital market issuance, were 25 per cent higher in September than at the same time last year, however S&P said that the figure remains below its peak and average for the past 10 years.
Further, the figure remained unchanged from August, which was “a divergence from the cyclical trend in which arrears typically decline between April and November before starting to rise again in December,” S&P said.
Arrears on full-documentation loans were unchanged from August, remaining at 1.10 per cent in September. Meanwhile, arrears on low-documentation loans decreased to 4.45 per cent from 4.87 per cent a month earlier.
Notably, arrears fell month-on-month for most originator categories except major banks, which recorded an increase to 1.11 per cent in September from 1.08 per cent in August. Non-banks recorded a rise to 0.62 per cent from 0.61 per cent a month earlier.
Non-conforming loans in arrears were up 9 per cent year-on-year, but remained well below their financial crisis peak of 17.09 per cent.