A significant reduction in broker-originated loans at Australia’s biggest bank is intentional, according to a major aggregator, which recently found that the big four have collectively lost 8 per cent of the broker market in 12 months.
The latest AFG Competition Index, released this week, found that the non-major market share for May 2017 grew to 34.95 per cent, up by 8.16 per cent since June 2016 when the majors held 26.79 per cent of the market.
At the same time, the major share fell from 73.21 per cent to 65.05 per cent.
AFG general manager of sales and operations Mark Hewitt said data showing CBA's market share sliding from 20.48 per cent in June last year to 11.8 per cent in May reflected a “deliberate strategy” to limit investor and interest-only lending in line with APRA mandates.
Earlier in the year, CBA stopped refinancing investor mortgages through the third-party channel. Any CBA customers with an investor home loan looking to refinance would have to visit the bank directly.
Meanwhile, Mr Hewitt noted that NAB continues to win market share after the bank streamlined its mortgage offering and distribution channels.
"NAB have benefited from their recent actions to align their broker products with their direct channels,” he said. “Until recently there was a difference between the products made available to their direct and broker-introduced customers which created confusion for borrowers.”
Westpac’s share of AFG broker-originated loans has fallen from 12.4 per cent to 10.8 per cent over the year, while ANZ has increased its share from 13.4 per cent to 15.8 per cent over the period.
Excluding AFG’s white-label home loan product, Suncorp Bank received the lion’s share of non-major loans with 6.67 per cent, up from 1.95 per cent in June last year.
“Mortgage brokers deliver true competition in the lending sector and provide real choice for consumers. If a lender is out of the market on service or price they will look beyond the majors to meet the needs of their client,” Mr Hewitt said.
“Increased competition delivers value to the consumer. Many of the non-major lenders on our panel do not have a branch network. Without the competitive tension mortgage brokers bring to the market, prices would inevitably rise.”