Business credit demand in New Zealand is down 0.8% year over year, and defaults are down 12%, but company closures and liquidations remain elevated, Centrix said in a report on Tuesday.
A softer housing market, rising unemployment, and higher borrowing costs carry the potential to place additional pressure on some households in the months ahead, the report added.
Meanwhile, consumer arrears increased to nearly 11%, with 424,000 people behind on repayments, but remain over 13% lower than a year ago, Centrix said. The number of consumers 90 or more days past due fell to 82,000.
Consumer credit demand declined 7.3% year on year, while new mortgage lending fell almost 12% during the July quarter, per the report. Mortgage arrears also increased slightly to 1.2%, with around 19,900 home loans past due, although this was 12% below prior-year figures.
Overall new household lending declined roughly 11% year on year during the July quarter, driven by weaker residential mortgage activity. Approved new mortgage lending was down 12% compared with the same period last year.