Macquarie Bank has emerged as the most successful non-major lender of the broker-originated home loan space over the past year, according to AFG.
Macquarie’s market share grew from 3.7 per cent of all broker-originated home loans in April 2013 to 6.5 per cent last month.
Released Tuesday, the AFG Competition Index found Macquarie was strongest in the refinancing and investor sectors in March, where it accounted for 9.7 per cent and 7.3 per cent of all loans, respectively.
Speaking to Mortgage Business, AFG general manager of sales and operations Mark Hewitt said Macquarie is investing heavily on all sides of its broker-centric mortgage business.
“They have all parts of their proposition, their marketing and product team, their credit team, their sales team and their leadership, all lined up to a common objective, so they have been very aggressive but they are also executing very well,” Mr Hewitt said.
“They are highly dependent on the broker channel, and are investing very heavily on all sides,” he said, adding that the investment bank is “a very good case study” of a business that has changed its focus.
“It’s no secret that the investment side of the business can be lumpy, so they are probably looking for some consistency of return that a successfully performing mortgage book can provide,” Mr Hewitt told Mortgage Business.
“That’s their strategy and they are doing it very well.”
The AFG Competition Index - which, according to Mr Hewitt, accounts for approximately 20 per cent of all broker business - found that while the non-major lenders’ share of first home buyer loans rose to a high of 31.7 per cent in March, they are struggling to make serious inroads into the hold of the major lenders.
The two largest non-majors in the first home buyer market were Keystart (9.7 per cent) and Homestart (3.8 per cent), according to the report.
Keystart and Homestart are both state government initiatives set up to help first home buyers in WA and SA, respectively.
The next biggest non-major in the sector is Suncorp, which in March had a 3 per cent share.
Among major lenders, CBA and Westpac both accounted for 24 per cent of all home loans processed by AFG, while ANZ accounted for 15.6 per cent and NAB 10.3 per cent (figures include their subsidiary lenders).