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By: Kate Miller
HSBC has unveiled plans to increase its footprint in the Australian mortgage market.
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The move bodes well for market competition, with new figures this week confirming the major banks’ ongoing dominance of the local mortgage market.
The bank yesterday reported a 28 per cent lift in pre-tax profit compared to the first half of 2009, including a 28 per cent increase in residential mortgages to $7.2 billion.
Alongside its results the bank announced plans to increase its share of the local mortgage market with a focus on “mass affluent” borrowers – those earning more than $88,000 a year.
Chief executive of HSBC Paulo Maia said HSBC's funding position gave it an advantage over other banks.
“Funding is still a key issue but we have more flexibility on that front and can grow faster [than the big four] because we have different funding alternatives,” he told The Australian Financial Review.
“We have group funding to support our business, which gives us a natural advantage when we want to chase new business.”
HSBC currently holds just a tiny portion of Australian residential mortgages with figures from APRA putting its share at 0.55 per cent in June this year.
With the big four banks holding 76.5 per cent of the market any move to increase competition is good news for consumers.
