The chairman of a listed Australian bank has said mortgage brokers are responsible for two-thirds of all new loans written by the banking sector.
Speaking at MyState Bank’s annual general meeting in Hobart yesterday, MyState chairman Miles Hampton outlined the significance of the third-party channel to the group’s mortgage distribution strategy.
“We have re-engaged with the broker market,” Mr Hampton said. “The reality is that two-thirds of all new loans written by the banking sector in Australia are being introduced by the broker network,” he said. “In our case, 70 per cent was broker-introduced.”
Mr Hampton noted that this is hardly surprising given the relatively low growth through direct channels in MyState’s traditional markets of Tasmania and Central Queensland.
Tasmania-based home loans represent 60 per cent of the group’s loan book compared with 66.8 per cent a year ago, while Queensland-based loans represent 16.4 per cent of its book.
“Increased reliance on broker-introduced business has seen loans to NSW and Victorian borrowers grow significantly,” Mr Hampton said.
“This lending is being prudently managed in the context of property prices that have risen significantly over the recent period. Loan book growth has been significant, but fewer customers are experiencing financial stress.”
Speaking about the bank’s risk appetite, the MyState chairman said the bank’s home loan book was made up of 87 per cent of loans to owner-occupiers.
“Investor loans are just 13 per cent of our loan book, well below the industry average of 35 per cent,” he said.
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
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