AFG Competition Index – September 2015

Majors come out swinging

The latest AFG Competition Index shows the majors hit back hard as the market showed signs of uncertainty due to regulator enforced changes to lender policy and pricing.

During June, major lender market share fell to 69% but the trend was quickly reversed in July and August as lenders started to tweak their policies. This saw the majors stretch their share back out to over 74%.

AFG General Manager of Sales and Operations said. “With regulator enforced changes to investment and interest only lending, this is the most disruptive period we have seen in the market for some time.  Major lenders are capitalising on this and using the size of their balance sheets to dominate their smaller competitors.

“The top three of ANZ, CBA, Westpac and subsidiaries all have a very strong hand however if there is a positive, it is that there is a very even spread amongst the next tier with some healthy competition within this group”

“Most of the investor changes were announced during July and are now starting to have an impact. Amongst the major lenders ANZ and CBA have both gained ground while Westpac has fallen back.  For the non-majors the most dramatic change has been with ING who have fallen from 5.2% of investment lending in July to 1% last month,” said Mr Hewitt.

“The lending landscape is changing rapidly and many borrowers are recognising more than ever the value of using a broker to help them navigate their way through the changes.”

ANZ had the largest single market share of new mortgages in August of 19.2%, followed by CBA (18.6%) and Westpac (13.1%).  Among non-majors, the largest market share in April was held by AFG Home Loans (4.7%)

AFG processed more loans for ANZ than any other lender last month for borrowers arranging refinancing loans (19.9%) and the big winner in the fixed rate space was BOQ who leapt to a 15.8% share.

With first home buyers, CBA was a clear leader in August with 19.3% of the business.

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