ANZ’s market update for the December quarter shows the eternal struggle between growth and profitability in Australia’s mortgage sector shows no signs of abating.blowout in loan processing timesShayne Elliott has previously blamed a risk averse culture for the loss of market share in home loans.Losing customers to your competitors is never a good outcome, especially when you are selling a product such as a 30-year mortgage.
, already a bigger fall than the 3 basis point fall Goldman Sachs had predicted across the full 2022 year. The pressure on margins is coming from competition here and across the Tasman, from the high proportion of lower-margin fixed loans sold in the past two years, and from rising funding costs. Rising interest rates in Australia and New Zealand will help, but not much; the bank warned Monday that due to the frequency with which mortgage customers are refinancing to jump to a new lender, “managing both attrition and margins remain key areas of focus”.
Like all banks, ANZ must keep walking a tightrope between keeping and winning customers, and lower profitability.