All 4 majors see loan book growth

The latest data on Australian authorised deposit-taking institutions (ADIs) released by the Australian Prudential and Regulation Authority (APRA) has revealed mortgage book growth across the board for the big four major banks in December 2023.

ANZ

ANZ recorded a total mortgage book increase of 0.52 per cent, bringing it up to $291 billion from $289 billion in November. The major bank’s owner-occupier book increased by 0.78 per cent to $195 billion, while its investor book rose by 0.54 per cent to $96.5 billion.

The most recent Broker Pulse survey released by Agile Market Intelligence for the month of December 2023 revealed that ANZ continued to be the most commonly used lender by brokers over the month with 43 per cent of brokers submitting applications to ANZ.

Client circumstances topped the primary reason for brokers choosing ANZ (62 per cent), followed by product pricing (37 per cent) and client preference (27 per cent).

ANZ also remains the only major bank with a cashback offer in the market for external refinances. It is currently offering $2,000 cashback on eligible loans over $250,000 with a deposit of 20 per cent or more.

Commonwealth Bank

The total mortgage book for the Commonwealth Bank of Australia (CBA) grew once again for now the second consecutive month following a string of decreases from July to September 2023.

Its total mortgage book rose 0.3 per cent to $545 billion, up from $543 billion in November. For its owner-occupier book, CBA saw an increase of 0.25 per cent, up to $364 billion by $909 million, notably almost doubling the increase of $499 million recorded in November.

CBA’s investor book also grew by 0.41 per cent to $182 billion (up by $748 million) in December, marking the largest monthly investor book increase.

NAB

NAB’s investor book saw a slight recovery in December following a modest decrease of 0.09 per cent in November, up by $23 million to remain above $108 billion. Its total mortgage book rose by 0.4 per cent to $316 billion, while its owner-occupier book grew by 0.61 per cent to $207 billion.

Westpac

In terms of dollar figures, Westpac once again recorded the strongest overall growth among its major competitors, with its total mortgage book increasing by $1.8 billion (0.39 per cent) to $461 billion. Owner-occupier mortgages held by the major bank increased by 0.56 per cent to $304 billion, while its investor book saw a slight increase of 0.08 per cent, remaining above $157 billion.

Overall figures

The total value of mortgages held by Australia’s ADIs grew 0.48 per cent to $2.16 trillion in December 2023, up from $2.15 trillion.

Both owner-occupier and investor books grew by 0.51 per cent to $1.46 trillion (up from $1.45 trillion) and 0.26 per cent to $696 billion, respectively.

UBS analysts John Storey and Olivia Clemson noted that overall lending in absolute terms is growing, but “the rate of growth is slowing”.

“ANZ’s momentum in O/O mortgages continued once again, growing at 1.5x system (0.8 per cent) m/m. NAB and WBC remained close behind, both 0.6 per cent m/m,” they stated.

“Overall, total mortgages grew 0.4 per cent m/m for the sector, with ANZ and MQG leading the pack again, 0.7 per cent m/m and 0.9 per cent m/m, respectively.

“CBA is making a comeback, growing total mortgages 0.3 per cent m/m, the bulk of which came from investor, 0.4 per cent m/m.”

Mortgage demand up for the first time since 2021

The data from APRA came as the latest Equifax Quarterly Consumer Credit Insights – December 2023 report revealed that mortgage demand rose 0.5 per cent year on year. According to Equifax, this was the first quarter of positive growth recorded since 2021.

General manager, advisory and solutions at Equifax, Kevin James, said the stabilisation of interest rates has had a positive impact on mortgages, with the demand share for new mortgages increasing to 28 per cent in 4Q23.

“Conversely, refinance demand dampened, suggesting that existing mortgages are also experiencing some financial relief,” Mr James said.

[RELATED: Mortgage demand lifts as interest rates stabilise: Equifax]