Commonwealth Bank chief executive Matt Comyn says relaxing the treatment of student debts in home loan applications will boost the borrowing capacity of prospective buyers but warned housing supply remained the biggest blocker of young people entering the market.

Speaking to The Australian Financial Review shortly after revealing a better-than-expected $5.13 billion interim profit on Wednesday, Mr Comyn backed Labor’s move to let banks exclude HECS repayments from mortgage serviceability tests when they expect the borrower to pay off the debt in “the near term”.