ASB says it won't wait for the Reserve Bank to bring back Loan to Value Ratio (LVR) restrictions for investors in March.
It is doing it now.
ASB will move immediately to increase the minimum deposit required from investors to 30 per cent in the wake of the Reserve Bank of New Zealand's announcement.
"ASB believes a balanced and sustainable housing market is in the best interests of all New Zealanders," said ASB chief executive officer Vittoria Shortt.
"While we appreciate the RBNZ taking the time to consult, this is about helping Kiwis build their financial futures during exceptionally challenging times so we are choosing to take this step now."
Shortt said the lending market had improved markedly since New Zealand went into its first lock down.
Covid-19 hadn't impacted the property market as anticipated and ASB is now witnessing rapid growth in lending volumes.
The number of applications it had received was at an all-time high, up 70 per cent on this time last year, and while the proportion of first home lending was up, there had also been a rapid increase in lending for investors.
If this increase in investor demand continues it could lead the country down a potentially unsustainable path, Shortt said.
"Our focus at ASB is on working with the Government on offering first home buyers opportunities to get onto the property ladder. That's why we're immediately committing to requiring investors to have a 30 per cent deposit rather than the current 20 per cent."
Pre-approvals already in place are unaffected.
"For us, it is about being a prudent and responsible lender. We all have to play our part and we're confident Kiwis looking to buy their first home will welcome this move," Shortt said.