Major lenders' share claws its way back up

by Rebecca Pike04 Apr 2018

Australia’s major lenders have seen their home loan market share rise back up, in the latest AFG Competition Index.

The index has also shown that the gap between the top four banks is closer than it has been for some time.

Westpac is on top with 14.21% of the market and ANZ is in third place with 12.32%, after a drop from 14.93% in November 2017.

While the major lenders now hold 66.78% of the market, which is up from 64.82% in November, the Westpac brands were the only group to increase their share.

Made up of Westpac, St George, Bank of Melbourne and BankSA, they rose from 20.28% in November 2017 to 27.05%.

CBA and NAB both fell, with CBA dropping from 14.99% to 13.63% and NAB from 8.57% to 7.67%.

The non-majors’ market share is now at 35.97%. Lender First Home Buyers is the most favourable in the category with their share rising from 31.31% of 33.38%.

Other non-majors to increase their share were AMP from 2.27% to 4.62%, Homeloans from 0.14% to 0.33% and WA-based Keystart, lifted from 0.18% to 0.26%.

Non-majors to see a decrease were Suncorp, who fell from 4.21% to 2.81% and Macquarie from 4.66% to 4.26%. Bank of Queensland lost almost 50% of their share to finish February at 0.86% of the market.

The Competition Index only calculates loans that were written through AFG but it does give a good indication as to where mortgage flow is strongest.

AFG General Manager Broker & Residential, Mark Hewitt, said the results showed that mortgage brokers are the only way Australian borrowers can get the whole picture.

In the recent Australian Competition and Consumer Commission (ACCC) interim report, the preliminary findings found that borrowers could not easily determine their options and were turning to brokers for help.

Hewitt added: “A consumer dealing directly with a lender has limited negotiating power or knowledge of the interest rates and lending criteria offered by competitors. This has been further validated by the findings of the interim ACCC Residential Mortgage Price Inquiry. The presence of the mortgage broking channel is one of the few drivers of competitive tension in the Australian lending market.”

 

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