Home lending sees moderate growth, but margins slimmed amid tougher business environment
ANZ’s Australian retail home lending portfolio increased by 3.6%, or $12 billion, on a year-on-year basis, in the first half of its financial year.
Brokers wrote 69% of all home lending in the period, marking a notable increase from 67% in the first half of the previous financial year.
Proprietary lending comprised the remaining 31%, compared to 33% previously. That is despite ANZ’s ambition to increase its exposure to proprietary lending in order to drive profitability under chief executive Nuno Matos’ so-called ‘2030 Strategy’.
ANZ is actively training and investing in its direct-to-customer mortgage sales force. The group plans to increase the amount in in-branch lenders by up to 50% or more over the next five years.
However, the broker channel appears in good stead at ANZ for now. As a total percentage of all balances, broker-introduced loans comprised 62% of the home-lending portfolio as of 31 March, up from 58% in the previous year.
ANZ’s total home lending portfolio stood at $348 billion as of 31 March.
Job cuts continue
Job cuts are also part of Matos' (pictured) strategy – of the 3,500 headcount reductions announced in 2025, 78% have left the business. His cost-cutting measures appear to be working – on a group-wide level, cash profit was up 14% on the previous half.
Mortgage market competition compressed profitability slightly in ANZ’s first half, with the group-wide net interest margin (NIM) falling three basis points to 1.56%. Impairment trends remained steady over the reporting period.
Regional subsidiary Suncorp Bank increased its home lending portfolio by 5% to $62 billion, while group-wide business lending flows increased by 2% to $68 billion.
“We have moved at pace to make good progress on our five immediate priorities,” said Matos. “We have refreshed our leadership team and commenced our cultural reset with new corporate values, and are on track to accelerate the integration of Suncorp Bank and deliver the ANZ single customer front-end.
“We have also made significant progress to reduce duplication and simplify the bank, while continuing to make progress in improving non-financial risk management. These actions, combined with our initial investment for growth, are laying solid foundations for the second phase of our strategy, which will significantly improve our customers’ experience and revenue growth.”
