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The latest Monthly Authorised Deposit-taking Institution Statistics from the Australian Prudential Regulation Authority (APRA) showed lending to non-financial businesses increased by $9.9 billion over August (+0.8 per cent) to $1.28 trillion.
The Commonwealth Bank of Australia (CBA) recorded the largest monthly increase among the major banks, with its loans to non-financial businesses rising by $2.8 billion (+1.1 per cent) to $250.6 billion.
National Australia Bank (NAB) remained Australia’s largest business lender, with its portfolio increasing by $1.7 billion (+0.6 per cent) over August to $278.2 billion.
The gap between the two banks stood at $27.7 billion at the end of August, with CBA’s business lending portfolio equivalent to 90 per cent of NAB’s.
CBA has also recorded faster annual growth than NAB, with its business lending portfolio increasing by $33.1 billion over the past year (+15.2 per cent), compared with a $27.2 billion increase for NAB (+10.8 per cent).
Business lending continues to climb
Lending to non-financial businesses increased by $9.9 billion over August, following a $7 billion rise in July.
The latest increase was below the $19.3 billion rise recorded in June, but lifted total lending to $1.28 trillion.
Despite the month-to-month fluctuations, total lending to non-financial businesses was $119.4 billion higher than a year earlier, representing annual growth of 10.3 per cent.
The four major banks accounted for $900 billion of lending to non-financial businesses at the end of August, representing around 70.4 per cent of the total market.
All four majors recorded an increase in business lending over the month, with CBA recording the largest dollar rise.
Westpac’s business lending portfolio increased by $1.5 billion (+0.7 per cent) over August to $211.9 billion, while annual growth reached $23.7 billion (+12.6 per cent).
ANZ’s portfolio increased by $1.5 billion (+1 per cent) over the month to $159.3 billion.
Its business lending was $8.8 billion higher than a year earlier, representing annual growth of 5.9 per cent — the slowest rate among the major banks.
Combined, the four major banks increased their business lending portfolios by $7.5 billion over August. Their combined lending was $92.7 billion higher than a year earlier, accounting for around 78 per cent of the total annual increase across all authorised deposit-taking institutions.
Growth in spite of a challenging picture
APRA’s results echo other findings across the market.
A report published by the Australian Banking Association (ABA) found 40 per cent of SMEs sought finance from their bank, while credit provided by banks reached a record $750 billion in April 2026, up from $567 billion in April 2023.
Banks such as the CBA, ANZ, NAB, and Judo Bank have also recorded strong growth in their business lending books.
This strong competition, both from banks and non-banks has also pushed the margin on small business loans above the cash rate to a five-year low, the ABA found.
And according to non-bank SME lender Banjo, businesses are putting that credit to good use.
Banjo’s latest SME Compass Pulse survey found that more than half of SMEs achieved their revenue targets over the past 12 months, unchanged from six months ago, while 72 per cent expect to achieve or exceed their targets for the year ahead.
Speaking to Broker Daily, brokers have also commented on the growing interest in business loans, flagging a structural shift in the role and approach of those in the sector as business pressures and credit requirements shift.
That being said, the uptick in demand comes amid a challenging picture for businesses.
NAB’s Business Survey, which has tracked confidence and conditions for more than 20 years, found business conditions turned negative for the first time since the pandemic while confidence is well below its long-term average.
Economic stress from higher interest rates and rising costs has impacted businesses’ margins, while ATO debt enforcement and regulatory changes such as Payday Super have also put pressure on cash flow.
In May, fellow credit bureau CreditorWatch found payment arrears had climbed to their highest level since January 2020.
This has been feeding through to business owners, with business-related personal insolvencies increasing 14.4 per cent in FY2025–26, reaching 4,046 cases, according to the Australian Financial Security Authority.
Mixed results among other lenders
Lenders outside the major banks recorded mixed movements over August, with some portfolios expanding while others contracted.
OCBC’s business lending portfolio increased by $231.9 million over the month, while MUFG recorded a $43.6 million decline.
Bank of China’s portfolio fell by $201.3 million over August, while Sumitomo Mitsui Banking Corporation recorded a $254.7 million decline.
ING Bank (Australia) recorded a larger monthly fall, with its business lending portfolio decreasing by $480.5 million.
The annual figures showed a different picture for some lenders, with several recording strong growth despite monthly declines.
MUFG’s business lending portfolio was $3.6 billion higher than a year earlier, representing annual growth of 20.5 per cent. OCBC recorded annual growth of $3.2 billion (+22.1 per cent), while Bank of China’s portfolio increased by $3.1 billion (+15.0 per cent).
Judo Bank’s business lending portfolio increased by $1.9 billion over the year (+16.6 per cent) to $13.3 billion at the end of August.
By contrast, Sumitomo Mitsui Banking Corporation’s portfolio was $4.6 billion lower than a year earlier, representing a 17.7 per cent decline.
[Related: Business loan demand defies asset finance slump]
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