Bank lent more than property valuation

Hi Ausfinance, wife and I purchased a property for $845k earlier this year. ANZ gave us a loan for $849k, even though this is more cash than we need.

Do lenders usually allow a home loan to be in excess of the valuation?

For context we are FHB and have put the excess back onto the loan as we don't currently need it, plus the added benefit of not being charged interest on that portion (effectively offset/repaid)

Thanks!