The Australian government to invest up to A$8 billion to support residential lending
The Australian government gave a formal green light on Monday to a proposal to invest up to A$8 billion ($7.35 billion) in additional public funds to support the country’s residential mortgage-backed bond market.
“This investment is an important part of the government’s commitment to strong and effective competition in Australia’s mortgage market,” Treasurer Wayne Swan said in a statement.
The market for residential mortgage-based securities all but collapsed during the global financial crisis and is being nursed back to health by the government, which wants to encourage non-bank lenders that rely heavily on this market for funding.
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