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Non-banks hardest hit by GFC: survey

by Staff Reporter10 minute read
The Adviser

Staff Reporter

Non-bank lenders have been hit hardest by the credit slowdown which followed the global financial crisis, a national survey has found.

Loan Market Group chief operating officer Dean Rushton said a poll of the company’s mortgage brokers found 65 per cent believe non-bank lenders had been most disadvantaged by the GFC.

13 per cent of respondents thought the major banks had been worst affected, while 11 per cent listed regional banks and international banks.

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“The GFC has ended up strengthening the position of the major banks and even regional banks as consumers perceived that they were more secure,” Mr Rushton said.

“Lower consumer confidence in the post-GST environment has meant that consumers have put more trust in the larger financial institutions.

“The credit slowdown also seriously cut access to cheap funding for non-bank lenders and put them at a disadvantage to the big players who can source funds at cheaper rates.”

But Mr Rushton said non-bank lenders were important to ensure the lending sector remained highly competitive.

‘”The situation for non-bank lenders needs to be closely monitored as they are an integral factor in consumers get the most competitive deals long term,” he said.

But while funding remains an issue for the non-bank sector, these lenders remain resilient and ready for battle.

This week, Mortgage EZY, Future Financial and Australian First Mortgage all cut the interest on their fixed rate products in line with the majors.

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