Non-majors clawing back share across the board

by Miklos Bolza16 Mar 2017
Australia’s major banks have again taken a hit to their market share as the non-majors continue to gain greater popularity amongst the public.

The AFG Competition Index shows that the market share of the big four banks has again dropped to just over 65%, continuing the downward slide of the past six months.

“The non-majors have continued to take market share from the majors this quarter, particularly among those seeking to refinance. Their share of the refinancing market grew by 6.5% with the big winners being AMP and ING,” said Mark Hewitt, AFG general manager of sales and operations.

The second tier banks also gained ground in the fixed interest rate space with an 8% increase in market share. ME and ING came out as the top performers in this area.

There was also a small 2% uplift in non-major market share by first home buyers, the aggregator’s research found.

The majors have typically been strong in both the first home buyer and investor areas, Hewitt told Australian Broker. This was particularly around their ability to lend to higher LVRs.

“Traditionally, they’ve probably had 75% of the investor market. If you look at August last year, they were at 75% and progressively the non-majors have been pulling that back. That’s now down to 67% on the investor side.”

For first home buyers, this was a similar picture, he said. While the majors had 78% market share in August last year, this has decreased to 68% till now.

There has also been movement in fixed home loans and refinancing, with more borrowers looking to the second tier banks for these lending options as well.

The non-majors would continue taking market share from the big four banks throughout the year, Hewitt added.

“I think the majors don’t have particularly strong appetites in some areas and they’re probably just concentrating on owner occupier, lower LVR and higher income type customers. They’re obviously prime customers. That’s opening up opportunities for the non-majors.”

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