The financial regulator says it is "working assertively" with banks to make sure they do not slash their home lending standards to chase more business.

The Australian Prudential Regulation Authority's chairman John Laker has told an economics lecture that banks need to remember the lessons of the US housing meltdown.

He says bank directors have assured him that lending standards are being maintained and APRA audits have not found any major problems, despite some major banks now advertising 5 per cent deposit home loans