General manager Adrienne Church said there had been an increase in activity since the new loan-to-value restrictions were applied to the banks.

They must now lend no more than 10% of their new loans to people with a deposit of less than 20%. But lenders such as Resimac are unimpeded and foreign companies are also reportedly eyeing the market.

The Reserve Bank acknowledged that in its recent Financial Stability Report. It said “regulatory leakage” could dampen the impact of the rules.

But it said non-bank lenders were unlikely to have the capacity to materially undermine the effectiveness of the LVR restrictions.

Church said: “We have seen an increase in business over the past few months, this has been for a range of reasons not limited to the recent market changes, it’s also due to us now being in the NZ market for over a year, our brand and service proposition is more widely known and we have niche products like our low doc product.”

The Bank reiterated that it wants lenders to adhere to the spirit of the policy – so those who were actively encouraging borrowers to arrange deposits from other lenders could be seen to be in breach.

Church said the customers Resimac was picking up were not necessarily those who would return to the mainstream lenders when the rules changed or when their equity became sufficient.

“As the increase in our business isn’t limited to the high LVR business, it’s also due to the reasons already commented we will see, our mortgage products are competitive with the banks in interest rates and features so time will tell.”