Ausatralian banks have imposed tighter terms and conditions on their lending, presenting significant repercussions for the property and infrastructure sectors, the head of domestic markets at the Reserve Bank of Australia, John Broadbent, has said.

Recent weakness in business credit can be attributed to the desire of firms to reduce leverage against the background of an uncertain economic outlook, Mr Broadbent told a corporate finance seminar.

Australian business credit fell 4.6% over the year to September and has fallen in every month since February, according to data from the RBA.

Some companies, particularly in the real estate and infrastructure sectors, have needed to raise more equity capital as a condition for the continued availability of loan finance, he said.

The Australian