ANZ and ASB lose ground on new lending even as switching between banks accelerates
New Reserve Bank Dashboard data for the June 2026 quarter shows a clear split emerging in New Zealand's home loan market, with two smaller banks outperforming their larger rivals on new lending.
Interest.co.nz analysis of the data found ANZ won just 26% of new mortgage business in the quarter, well below its embedded 29.3% share of the overall book, while ASB fared worse still, winning only 12.2% of new business against a 21.0% book share.
BNZ was the standout performer, capturing 27.7% of new lending — more than any other bank — despite holding only 16.9% of the existing market. Kiwibank also outperformed its size, winning 10.4% of new business on an 8.0% book share.
Westpac joined ANZ and ASB among the underperformers, winning 15.6% of new lending against an 18.4% book share.
Interest.co.nz banking analyst David Chaston said the results help explain recent pricing behaviour among the larger banks.
"This helps explain why ANZ has been prepared to drive margins lower to recover their share slide, which (pandemic excepted) has slid from about 40% of new business when Reserve Bank Dashboard data first became available, to just over 26% now," Chaston said.
Borrowers increasingly willing to switch
The total New Zealand home loan market, including all banks and non-bank lenders, exceeded $400 billion for the first time in June 2026. While overall market share shifts have historically been slow, borrower mobility between lenders is rising sharply. RBNZ data shows $28.5 billion in home loans switched between banks over the past year, a 7.5% switching rate — up from 6% the previous year and just 4.1% the year before that.
Chaston said this growing willingness to shop around is reshaping the competitive dynamic.
"Overall, despite the apparent rigid market share base, it is possible to make gains, and it is clearly possible to lose market share. Borrower activity shifting for a better deal is rising too, so the pendulum is starting to swing in favour of consumers," he said.
Bank margins squeezed as competition for advisers' clients intensifies
For mortgage advisers, the data points to a market where competitive pressure is intensifying rather than easing, particularly among the larger banks defending their book.
Chaston noted this is already showing up in bank results, with the sector reporting lower profits, lower net interest margins, and executives "complaining about 'uncommercial offers.'"
That pressure on profitability lines up with KPMG's July 2026 sector report, which found banks' "margins are normalising" as deposit competition intensifies and borrowers grow more price-sensitive.
With switching rates climbing and smaller lenders gaining ground on price, advisers have a widening opening to negotiate sharper terms for clients weighing a refinance from a major bank.
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