The number of housing loans with payments overdue crept up further in May, giving weight to concerns about potential problems emerging for banks if the economy gets into trouble.
The latest rise was only small, with 1.14 per cent of loans in arrears, compared to 1.07 per cent in April, according to new data from S&P Global Ratings on Monday.
And, although it was the seventh rise in a row, that would not normally be a reason for concern.
Fluctuations in home loan arrears are seasonal, typically falling to lows in the spring before peaking in late summer and remaining relatively high through the autumn months.
But even allowing for that seasonal pattern the trend does appear to be upward.
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This last time the arrears rate in May was lower than a year before was 2011.
That year marked the culmination of a long period of exuberant lending and rising interest rates capped off by the shock of the global financial crisis and a sharp rise in unemployment.
Until recently, the trend in arrears rates has been downward as the economy improved and the banks, urged on by the banking regulator, become more cautious in their lending practices.
Despite the beginnings of an upward trend, the latest reading on arrears was still relatively low, only three quarters of the May 2011 level of 1.64 per cent, which was itself still enviably low by world standards.
Even so, there is potential for this to be the start of something more serious.
Last week, Moody's Investors Service released a report warning that Australian banks faced headwinds from high household debt and chronically low interest rates.
That, combined with a persistently weak labour market putting downward pressure on wages growth, was making the banks more vulnerable to shocks, Moody's said.
S&P's figures on Monday suggested that it was the borrowers already in the most trouble who were falling further behind.
While the proportion of loans less than two months behind was virtually unchanged from a year earlier in May, those more than two months behind accounted for all of the rise in the total arrears rate.
The value of loans in arrears rose from $14.6 billion to $16.5 billion, out of a total of $136.9 billion of securitised loans covered by the analysis.
And $1.7 billion of that $1.9 billion rise was accounted for by loans more than two months in arrears.
