Australia's main financial regulators on Friday said the proposed removal of responsible lending requirements for banks would support the supply of credit in reviving the economy from the effects of the coronavirus pandemic.

In a quarterly statement, Australia's Council of Financial Regulators (CFR) said banks should be prepared to use the extra capital built up during good times to support the supply of credit.

The proposed changes will support the supply of credit while requirements for prudent lending by banks will remain in place through financial regulator Australian Prudential (LON:PRU) Regulation Authority's (APRA) lending standards, the council said.

The CFR is made up of APRA, the Australian Securities and Investments Commission, the Australian Treasury and the Reserve Bank of Australia.

Reference by: Investing.com