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New Zealand Reserve Bank activates debt-to-income restrictions

WELLINGTON ― The Reserve Bank of New Zealand (RBNZ) has confirmed the activation of Debt-to-Income (DTI) restrictions and loosening of Loan-to-Value Ratio (LVR) restrictions at the settings that were consulted on earlier this year.

The new DTI restrictions will create limits on the amount of high-DTI lending that banks can make, which means the borrower has taken on a high amount of debt relative to their gross or pretax income, an RBNZ statement said on Tuesday.