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ISCOVER
By: Belinda Luc
The majors’ mortgage market dominance may soon come to an end, a new report has found.
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According to the Fujitsu Consulting and JP Morgan ‘Australian Mortgage Industry Report’, the big four are unlikely to continue their stellar rate of growth going forward.
“We expect the market share shift to the major banks to plateau by the end of the year, with the re-emergence of securitization markets to assist wholesale finance providers and the rising cash interest rate environment to assist primarily deposit funded institutions such as smaller banks, credit unions, and building societies,” the report read.
According to the report, major banks have increased their mortgage market share from 65 per cent to 76 per cent since start of the GFC.
CBA and Westpac dominate the market share with 25.9 per cent and 24.1 per cent respectively, while NAB holds 13.2 per cent market share. The study attributes the combined 8.3 per cent growth of these banks to their size, allowing them to capture the housing credit growth dynamics of the last 18 months.
"As a direct consequence of being able to access credit on reasonable terms, bank mortgage originations have been consistently higher than other mortgage providers.
"Further, the lack of financing alternatives has meant that existing bank customers are staying with the institution for longer, thereby reducing churn,” the report read.
ANZ holds the smallest market share of all the majors at 12.5 per cent.
