HSBC mulls third-party plans

HSBC confirmed this week that as part of regular reviews of its business it will “research options for third-party mortgage introducers”, but added that it currently does not have any relationships with broker groups.

Back in 2014, HSBC told The Adviser’s sister publication Mortgage Business it had “no plans” to re-enter the broker market.

Since then, the third-party channel has become the preferred source of home loans for Australian borrowers. Industry leaders have tipped broker market share to reach 60 per cent this year.

The foreign-owned bank came under pressure from the prudential regulator last year when it was forced to pause its investor lending to existing mortgage customers in October.

At the time, Graham Heunis, head of retail banking and wealth management for HSBC in Australia, said the bank had put “a number of measures in place to address the needs of our customers and adhere to our regulatory responsibilities”.

“These mechanisms include limiting investor home loans to existing customers only, as well as providing owner-occupier customers with a highly competitive variable rate,’ Mr Heunis said.

According to the latest APRA banking statistics, HSBC’s investor loan book was valued at $4.9 billion at December 31, 2015, marginally higher than the value of its owner-occupied book at $4.7 billion.

With a total loan book of $9.6 billion, HSBC’s share of the local mortgage market is comparable to AMP Bank ($9.8 billion), Citi ($7.9 billion) and ME ($12.9 billion). All three banks are active in the broker channel.

ING Direct has the largest loan book of the foreign-owned banks operating in Australia at $38.1 billion.

[Related: AMP to re-enter investor mortgage market]