One in three borrowers will refinance their home loan with a non-major lender, according to new data from one of Australia’s largest mortgage aggregators.
Thirty-four percent of borrowers who refinanced their home loan last month did so with a non-major, according to AFG’s quarterly Competition Index. Across all categories of borrowers, non-major lenders collectively accounted for just over one in four (28.3%) of all new mortgages processed. This is the highest such figure for non-major lenders since AFG began recording competition figures at the start of 2012.
Suncorp had the biggest share of refinancers among non-major lenders, accounting for 10.3% of all home loans in this category – a larger share than Westpac (8.8%), NAB Broker (9.6%) and St George (5%). Macquarie Bank was the second largest in the category in October, delivering 7.5% of all refinancing home loans.
Mark Hewitt, general manager of sales and operations at AFG, says this is evidence of healthy competition in the banking sector.
“It is very encouraging from a competition perspective to see borrowers more and more willing to explore alternatives. Suncorp are a great example of this. Traditionally they have struggled outside their home state of Queensland however through delivering on a combination of customer value and service they have reached an all-time market share high of 8.2%.”
The AFG Competition Index also shows that major lenders accounted for 71.7% of all new home loans in October. Despite the share of major lenders decreasing overall, ANZ replaced CBA as the number one brand on the AFG panel, accounting for 17.6% of all new loans.
Like refinancing, Suncorp Bank
also had the largest share of all new home loans among non-major lenders, accounting for 8.2% of total new home loans in October. This was followed by Macquarie on 5.1%, ING on 3.1% and Bank of Queensland
(BOQ) on 2.6%.
Non-majors also increased their share of investor loans in October, increasing from 24.6% in September to 26.2% in October. However, they decreased their share in the first home buyer loan market, down from 32% in September to 30.9% in October.