As at 31 December 2019, this was the lowest rate of mortgage lending growth in Australia in the past decade.
In terms of new mortgage financing, or settlements, this totalled $A316 billion over 2019 (an average of $A26.4 billion per calendar month). This was a reduction of 7.5 per cent compared with the prior period in 2018. However, this overall fall in 2019 was largely a story of two halves.
In the first six months to June 2019 settlement volumes were up to 20 per cent lower than corresponding periods in 2018.
But in the second six months of 2019, settlement volumes returned to levels that were consistent with and slightly higher than comparable months in 2018.
Offering and experience
ANZ General Manager Home Loans, John Campbell, says the bank is forecasting 2 - 3 per cent growth in settlements in 2020 but would ideally like this to be higher.
“As we work our way through what it means to be a responsible lender, there are different interpretations of the regulations and rules. Lenders do tend to interpret it differently,” he says. “The interpretation plays out predominantly in policy setting, which then impacts assessment and operations, ultimately influencing certainty and confidence for customers.”
Campbell says the questions to be answered are:
- How do you meet customer needs?
- Do you have an offering that customers want?
- When customers walk down the street, or search on the internet, how do you make sure they choose your bank?
“It’s how you provide the right offering and experience in your various channels,” he says. “We don’t have the luxury of focusing only on a single channel. We compete across a number of channels, whether it’s through the aggregator and broker channels, or via our own lenders, branches, or contact centres.”
According to Campbell, “clearly when customers are choosing to use a specific channel, they are telling us there is something they find easier, or simpler or faster”.
“Channels have to operate in an ‘omni-channel’ manner, so the customer can seamlessly move between different channels. They may start in the branch and finish on the phone,” he says. “Or maybe start with a broker, go into a branch to do something and then finish online.”
Campbell says the other big question is how banks offers their services in a responsible manner. “Therein lies the challenge – how do you do lend in a responsible manner while making sure you have a proposition that delivers simplicity, speed and ease.”
James Hickey is Partner, Consulting and Heather Baister is Partner, Audit & Assurance at Deloitte
For more an in-depth look at Deloitte’s Australian Mortgage Report and details from the roundtable click here.