AFG Competition Index – April 2015

Major mortgage lenders have succeeded in winning back market share of new home loans which they lost during the closing months of 2014, according to new data published today by AFG, Australia’s largest mortgage broker. AFG’s Competition Index shows that the overall 67.7% of loans processed for major lenders last December, which represented an all-time low since the GFC, climbed back to 74.7% by April 2015. This figure is in line with the market share held by Australia’s Big Four banks and their subsidiaries for most of the past two years.

The fight-back by major lenders has been more successful in some sectors than others. Their share of refinancing loans bounced back from 58.6% in December 2014 to 69.3% in April 2015. Among investors there was a rise during the same period from 73.3% to 77.3%. But fixed rate loans processed for non-majors have continued to perform strongly with their market share of 38.7% in December 2014 rising to 46.6% last month.

Mark Hewitt, General Manager of Sales and Operations says: ‘We’re seeing a keener and more diversified market than ever before. Many borrowers are well aware of this and are increasingly using brokers to help them find the best deal. The growth of white label products is starting to become a competitive factor, and we expect this trend to grow in coming months.’

Commonwealth Bank of Australia had the largest single market share of new mortgages in April of 20.8%, followed by ANZ (17.2%) and Westpac (12.1%). Among non-majors, the largest market shares in April were held by Macquarie Bank (5.6%), ING (2.8%) and Suncorp (2.7%).

AFG processed more loans for ANZ than any other lender last month for borrowers arranging refinancing loans (19.2%) and investors (18.5%). In the fixed rate loan sector, 14.6% of all loans were processed for ME Bank – the next highest figure was ANZ (14.0%).

Among first home buyers, more loans were processed for Commonwealth Bank of Australia than any other lender (24.5%) followed by Westpac (13.5%), ANZ (10.5%) and Keystart (9.1%).

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