Brokers still write majority of new home loans, but first-party originations up over financial year
Westpac has lifted the share of new home loans written through its own proprietary channel to 36%, up from 33% a year earlier, as the major bank pushes to originate more mortgages in house.
The figure, which was disclosed in Westpac's full-year results for the 12 months to 30 September, climbed further to 37% in the second half.
Mortgage brokers still originated close to two-thirds of the bank's new Australian home lending across the year.
Westpac has made lifting that proprietary share of new home lending a strategic goal, and the full-year numbers show steady progress from the 34% it reported when it posted its first-half results in May.
"We also increased first-party mortgage origination and this remains a priority," chief executive Anthony Miller said in today’s results announcement.
The bank credited service initiatives for the shift, including its "Book a Banker" appointment tool, additional bankers and process improvements. Westpac said Book a Banker has facilitated more than 100,000 home loan appointments since February. Higher staff costs in its Consumer division were partly driven by "investment in additional bankers and initiatives to drive proprietary growth".
Westpac is not alone. NAB has also grown proprietary loans following a banker hiring spree, even as industry data shows broker market share hitting a new record across the wider market.
How did Westpac's home lending volumes perform?
Westpac's Australian home loan book, excluding the RAMS portfolio, grew 7% to $531.9 billion at 30 September, up from $497 billion a year earlier. That growth ran at 1.1 times system growth measured by the Australian Prudential Regulation Authority (APRA). Almost all new lending was in variable-rate mortgages.
The headline figure excludes RAMS, the mortgage brand Westpac agreed to sell in November 2025. The $21.6 billion RAMS book was carried on the balance sheet a year ago, and the sale completed in August 2026. Measured against a base that includes RAMS, Westpac's total Australian home lending grew by roughly 2.6%.
Momentum cooled through the year, with average monthly mortgage applications at Westpac falling 15% year on year in the three months to 30 September.
Offset balances grew faster than loans, climbing 12% to $81.5 billion, which the bank attributed to portfolio growth and customers recognising the benefits of offset accounts.
"This year we helped more than 190,000 Australians purchase a home. While the housing market slowed as buyers adjusted to rising rates and policy change, this remains consistent with previous cycles," Miller said.
Mortgage margins narrow
The volume growth came at a cost to pricing. Net interest margin – the gap between what a bank earns on loans and pays on deposits – fell seven basis points to 1.73% in Westpac's Consumer division, which houses its Australian mortgage book. Excluding timing effects from rate changes, the decline was three basis points.
Westpac named "lending competition to retain existing, and attract new, mortgage customers" as the first driver. Across the group, loan spreads narrowed five basis points on tighter Australian and New Zealand mortgage pricing and Australian business lending.
Consumer net profit still rose 4% to $2.3 billion, helped by a 1% fall in operating costs. Group statutory net profit was $6.8 billion, down 1%.
Australian mortgage arrears of 90 days or more fell six basis points to 0.67%. That figure was flattered by the RAMS sale, which lowered the ratio by 10 basis points, while reclassifying some hardship arrangements added four basis points. In the second half, underlying arrears rose five basis points, which the bank linked to "higher interest rates and cost of living pressures". Properties in possession rose by 18 to 172.
Westpac's 2026 risk disclosures, released alongside the result, flagged that the negative gearing and capital gains tax changes in the 2026–27 Federal Budget "may reduce investor demand for established residential property" – a shift brokers are already bracing for among investor clients. The bank also cited APRA's limits on high debt-to-income lending, which took effect on 1 February 2026.
Miller expects little relief on rates. "Inflation remains above the Reserve Bank's target range and interest rates are likely to remain elevated into 2027. This is presenting challenges for many households and businesses, although impacts are uneven across the economy," he said.
The Reserve Bank of Australia (RBA) hands down its November rate decision on Tuesday 3 November 2026.
