ANZ to set aside more against mortgages

ANZ says it will need to set aside more capital against its residential mortgages following the banking regulator's approval of a new capital model.

ANZ says it will need to set aside more capital against its residential mortgage lending book. (AAP)

ANZ says it will need to set aside more money against its residential mortgage lending book following the banking regulator's change to its capital requirement for Australian residential mortgages and a review of the lender's mortgage capital model.

The bank expects the Australian Prudential Regulation Authority's new model will lower ANZ's Level 2 Common Equity Tier-1 ratio by 26 basis points, based on its balance sheet at 31 March 2017, representing an average risk weight or around 28.5 per cent.

The lender said it will not need to raise any additional capital as the impact is in line with its 2017 capital management plan.