 Banks dominate mortgage market
Westpac-St George and the
Commonwealth Bank-BankWest are dominating the home loan market with a huge 85 per cent share in new mortgages in the January - March quarter of 2009.
A review of the banking industry in Australia by market research firm Brandmanagement, found that a whopping $22.7 billion of the $26.6 billion growth in mortgage books by the big
four banks in the March quarter was achieved by CommBank/BankWest ($15
billion growth) and Westpac/St George ($7.7 billion), according to The Australian.
Australian Competition & Consumer
Commission chair Graeme Samuel said the reluctant decision to allow the merge, came after consultation with other regulators during the middle of the economic crisis.
Mr Samuel said yesterday that the approval
the commission had given to the merger between CommBank and BankWest
was "not one we had been very happy about." But given the crisis in the
international banking sector and on advice from the RBA and APRA "we
felt we had no choice", he said.
The mergers of so many banks has decreased the market share of non-bank lenders, and allowed the Big Four to dominate the mortgage market. There are concerns that this could lead to less competition and higher rates for consumers.
The Reserve Bank has cut interest rates six times since September. The first five rate cuts were passed on either in full or in part, with only the final rate cut not being passed on by much.
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