Westpac manages to weather home loan price war
Westpac's strategy of standing aside from the price war in the New Zealand mortgage market doesn't seem to have hurt it much.
Friday, May 6th 2005, 6:25AM
by Jenny Ruth
The bank's mortgage book grew by about $600 million to $20.1 billion over the March quarter.
Using Reserve Bank of New Zealand figures as a proxy for the market, that puts Westpac's share at 19.4% compared with 19.6% at the end of December and with 19.5% at the end of March last year.
Westpac New Zealand chief executive Ann Sherry puts the bank's market share of overall lending at 17.2% in March at the bank's share of the market at 19.25% at the end of March but didn't explain how she arrived at that figure.
According to the central bank, total mortgage lending by registered banks at March 31 was $103.36 billion. (The Reserve Bank figures for March weren't available when ANZ/National Bank reported its results and the figures show its market share has almost stabilised, slipping from 35.1% at the end of December to 35% at the end of March).
In the year ended March, the bank's mortgage book grew 15% from $17.4 billion.
The bank's overall net profit rose 4% to $323 million during the six months.
"That Westpac did not trade-off market share against profitability to the same extent as some competitors during the period is reflected in this solid result," Sherry says.
Westpac had ensured choice for its customers through competitively priced specials "while also having confidence in the quality and service proposition for our customers.”
"Clearly, with this amount of business, had competitive conditions in the market been different, our solid profit result would have been even better."
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