News: WBC Australian regulator backs banks offering pandemic relief to borrowers

July 19 (Reuters) - Australia's financial regulator on Monday announced relief measures for banks offering support to borrowers impacted by the COVID-19 pandemic, as the country battles this year's worst outbreak with nearly half the population confined to their homes.

Banks will not have to treat loans granted with three-month deferrals before the end of August as debt in arrears, the Australian Prudential Regulation Authority (APRA) said.

This will help the lenders, including the 'big four' that have promised interest-free loans, fee waivers and repayment deferrals, from allocating higher risk weightage or keeping aside more capital to back such debt.

The Commonwealth Bank of Australia (CBA) also pledged to extend the moratorium on any foreclosures until at least February next year.

Sydney, Australia's largest city, and all of Victoria has been put under lockdown in an effort to curb the spread of the fast-moving Delta variant of the coronavirus.

Last year too, APRA's regulatory relief had helped banks navigate the pandemic as deferrals rose to more than 10% of their loan books, before falling to less than 1% by the time it expired in March.