Owners of holiday houses may be hit with higher mortgage repayments as the effects of a change in the way the prudential regulator collects statistics works its way through the banking system.

As part of efforts to make sure Australia’s banks are “unquestionably strong” and could resist another global financial meltdown, the Australian Prudential Regulation Authority has tightened the rules covering what type of loans qualify as “owner-occupied” home loans – the safest and generally the cheapest type.

The move, first reported by Banking Day, has forced banks to move tens of billions’ worth of loans out of the owner-occupied category and into the “other residential mortgages” basket, where they sit alongside generally riskier and more expensive loans including those made for investment purposes.

Apra is currently considering how these changes should affect the amount of money it demands banks put aside to cover the risk that loans aren’t repaid.

Banking sources say they expect Apra to increase this amount for loans that do not qualify for the new, stricter definition of owner-occupied.

This would reduce bank profit margins and they would then be faced with a choice of taking a hit to the bottom line or passing the cost on to customers.

Neither option is attractive for banks already reeling from the financial effects of five years of scandals in the sector that have resulted in a royal commission, billions of dollars in compensation bills and fire sales of formerly fashionable but now tarnished businesses such as financial advice and insurance

At the same time, the banks are under intense political pressure to pass on every cent of interest rate cuts that this week brought the benchmark cash rate to an all-time low of just 0.75%.

The choice also looms amid a stoush over debate over bank lending practices.

As Guardian Australia revealed this week, the banks have been lobbying Morrison government ministers and backbenchers over a crackdown by the corporate regulator on responsible lending standards.

The banks are angry about the Australian Securities and Investments Commission’s decision to appeal a responsible lending case it lost against Westpac known as the “wagyu and shiraz” judgment because in it federal court judge Nye Perram gave the two luxuries as examples of things on which borrowers could spend less in order to afford their loan repayments.

The treasurer, Josh Frydenberg, and the prime minister, Scott Morrison, last week softened their stance towards the banks, which had been hardened by the flow of scandal from the royal commission, and talked up the importance to the economy of keeping credit flowing.

Last Thursday, Frydenberg told a property forum that if the laws were applied “too stringently”, they would stop borrowers shopping around for a better deal.

After the banks largely refused to pass on Tuesday’s 25-basis point rate cut in full, the rhetoric from the government became angrier, with Morrison accusing them of “basically profiteering”.

“Ultimately, it’s the customers who can vote with their feet and I would encourage your viewers to go to their bank, seek the best possible deal and if not take their business elsewhere,” Frydenberg said in an interview on ABC TV’s 7.30 on Thursday night.

None of the big four banks except the commonwealth would comment on whether they would have to increase interest rates on some loans due to Apra’s statistical shenanigans.

This includes Asic target Westpac, which is the most affected by the change with $38bn taken from its owner-occupied loan book and $32bn added to its investor loan total at the end of June, when the reclassification took place.

However, on 30 August CBA told the market the reclassification subtracted $27bn from its owner-occupied loan book and added $22bn to its investment property book – but insisted the changes would have no effect.

“The restatements are for statistical reporting purposes only and have no impact on customers, the security and serviceability arrangements for housing loans, regulatory capital, risk appetite, risk-weighted assets or statutory financial statements,” the company said.