Lucy McLelland has experienced first-hand the stress of trying to secure a speedy loan approval in Sydney’s fiercely competitive property market.
“I had assumed the process would be quicker, but now I understand what the process involves,” she says. “I’m an existing customer, they have all my information,” says the 37-year-old father of two. “But I lost the house I really wanted to buy at that time.” For ANZ, mortgage processing has been a major weakness. Its latest financial results showed sluggish growth in its home loan book, with chief executiveadmitting the bank was not ready for the mortgage boom caused by low interest rates, high government stimulus and lockdowns that sent savings skyrocketing.Sally Tindall, director of research at RateCity
Director of research at RateCity, Sally Tindall, cites official figures showing 1 million home loan applications were settled in the last year, up 30 per cent from the previous year. She says the massive increase has put a major strain on many banks’ outdated legacy systems, when banks were also struggling with staffing challenges due to the COVID-19 pandemic. For many customers, the result was lengthy delays.
Aside from ANZ’s mortgage processing woes, Westpac’s latest results were also dogged by a poor performance in its flagship home lending business, sparking a dramatic fall in its share price. “There’s plenty of competition, there’s plenty of capital, and then because we’ve chosen to grow into that lower-yield market then the margin comes down,” King said at its results.
CBA will publish its September quarter trading update next week, but the lender has carved out an even more dominant position in home lending throughout COVID-19, with its market share hitting 26 per cent at its latest results.
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