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Australia’s largest home lender has lost ground in the broker channel to its big four rivals, according to new data.
The Australian Finance Group (AFG) has released its latest quarterly mortgage and competition index for the three months to December 2019, reporting a decline in the market share of the big four banks (excluding subsidiaries) from 54 per cent to 53.1 per cent.
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Accordingly, the market share of the non-major banks increased, from 46 per cent in the September quarter to 46.9 per cent.
The index – which is based off data collected from AFG’s network of 3,000 brokers – revealed that the fall in the market share of the major banks was driven by a slide in the number of lodgements to the Commonwealth Bank of Australia (CBA).
CBA’s market share slipped for the second consecutive quarter, from 16.6 per cent in the three months to September to 14 per cent.
CBA’s subsidiary Bankwest also recorded a decline in market share, from 7.1 per cent to 5.9 per cent over the same period.
In total, CBA Group’s share of the broker space dropped from 23.7 per cent to 19.9 per cent.
CBA was the only major bank to record a decline in its share of broker lodgements, with its peers gaining territory in the December quarter.
According to the index, ANZ continued to recover lost ground, increasing its share of broker lodgements from 9.1 per cent to 10.7 per cent, after recording declines in both the March and June quarters.
NAB also strengthened its position in the third-party channel, with its share rising from 7.9 per cent in the September quarter to 9.6 per cent.
Meanwhile, Westpac closed in on CBA, growing its market share from 6.2 per cent to 8.6 per cent, while its subsidiaries (Bank of Melbourne, Bank SA, and St.George Bank) increased their share of lodgements from 6.9 per cent to 7.7 per cent.
Westpac Group’s overall share of broker lodgements jumped from 13.1 per cent in the September quarter to 16.3 per cent.
Of the non-majors, Macquarie Bank continued to boast the largest share of broker lodgements, despite its share slipping from 11.3 per cent to 10.1 per cent.
Macquarie lost its second-place ranking in the December quarter (when excluding major bank subsidiaries) to ANZ but continues to outshine NAB and Westpac in the index.
AFG brokers sent just under 10 per cent of their lodgements to their aggregator’s lending business, AFG Home Loans, up from 8.7 per cent in the previous quarter.
Lodgement volumes
According to the index, surveyed brokers lodged $15.4 billion in home loans over the December quarter, down from $15.7 billion in the previous quarter, but up from $12.9 billion in the December quarter of 2018.
Reflecting on the index, AFG CEO David Bailey said the data was further evidence of renewed confidence in the home loan market.
“We’re encouraged by the lending data. These figures show the national home loan market has consolidated the strong growth from the September quarter,” he said.
“We enter the new year buoyed by the healthy volumes in the second half of 2019, reinforcing the change in market sentiment during the year.”
Mr Bailey continued: “It’s very clear that buyers have been enticed back to the market, and the data is showing us that there is an incontestable trend away from the major banks.
“Consumers are empowered by the enhanced competition in the home loan sector generated by mortgage brokers and are reaping the benefits through greater choice and lower prices.”
The proportion of loans lodged on behalf of investors and first home buyers (FHBs) remained stable when compared to the previous quarter, at 26 per cent and 15 per cent, respectively.
The split between lodgements for principal and interest and interest-only borrowers also remained stable at 82 per cent and 18 per cent, respectively.
[Related: Macquarie closes in on competitors in mortgage market]
