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The major banks’ share of the third-party channel has dwindled over the past quarter, according to new data from AFG.
The Australian Finance Group (AFG) has released its mortgage and competition index for the September quarter, which is based off data collected by the aggregator’s network of 3,000 brokers.
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The data has revealed that both the Commonwealth Bank of Australia (CBA) and Westpac have lost ground in the broker channel, with brokers writing fewer loans to the respective lenders.
In the three months to 30 September, CBA’s share of the broker channel slipped from 17.7 per cent to 16.7 per cent.
When including its subsidiary Bankwest, the Commonwealth Bank’s share of the channel fell from just over a quarter (25.1 per cent) in the June quarter to 23.8 per cent as at 30 September.
Meanwhile, Westpac’s broker market share declined from 7.7 per cent in the June quarter to 6.2 per cent.
When including its subsidiaries (Bank of Melbourne, BankSA and St George Bank), Westpac Group’s total share of the third-party channel slipped from 14.9 per cent to 13.1 per cent over the same period.
ANZ, NAB gain ground
Conversely, ANZ and NAB have each recorded increases in their respective shares of the broker market.
ANZ’s share of the third-party channel rose from 8.5 per cent to 9 per cent in the September quarter. This followed a contraction of 4.2 percentage points in the 12 months to 30 June 2019.
NAB, on the other hand, recorded its second quarterly increase in broker market share, with its share of AFG volumes rising from 7.3 per cent as at 30 June to 7.9 per cent in the three months to 30 September.
Macquarie closes in on CBA
According to the AFG Index, Macquarie continued to gain ground in the broker space, with its market share rising from 9.7 per cent as at 30 June to 11.4 per cent.
The bank’s broker market share has more than doubled over the 12 months to 30 September, from 4.6 per cent.
Macquarie has maintained its second place ranking in the broker space (when excluding subsidiaries), behind only CBA.
Another non-major to record strong growth over the quarter was AMP, with its share of the market rising from 2.4 per cent to 3.6 per cent.
Overall, non-major market share increased from 42.4 per cent to 45.9 per cent — the highest reported share since 2007.
Accordingly, the market share of the big banks fell from 57.6 per cent to 54.1 per cent.
Reflecting on the rise in non-major market share, AFG CEO David Bailey said borrowers are benefiting from the enhanced competition in the mortgage market.
“Consumers are continuing to express a desire to seek out competitive offers,” he said.
“First home buyers, upgraders and mortgage holders refinancing have driven the market share of the non-major banks.
“From the perspective of loan volumes, we are now approaching a 50-50 split between the majors and non-majors. Something unheard of as little as five years ago.”
He concluded: “This represents a fundamental shift in the dynamic between lenders. Consumers are sending a very clear message that they want the choice and the transparency of a competitive home loan market in Australia and mortgage brokers are delivering.”
[Related: AFG volumes propelled by market tailwinds]
