Big four players will have to hold more capital to cover lending above 80 per cent of the value of property.

The Reserve Bank has given its strongest signal yet that it intends to restrict mortgage lending at high loan-to-value ratios, to rein in credit growth and house price inflation it already regards as "problematic".

The bank confirmed yesterday that it will increase, from September, how much capital the big four banks have to hold to cover lending at LVRs above 80 per cent.

That raises the permanent baseline from which potential temporary, counter-cyclical restrictions on LVRs would apply.

Such restrictions are one of four "macro-prudential...