tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, April 19th, 11:55AM

Mortgages

rss
Latest Headlines

ASB admits advisers don't like its pricing

ASB chief executive Vittoria Shortt acknowledges her bank has lost ground with mortgage advisers because of its uncompetitive pricing, but she isn't promising anything is going to change in a hurry.

Thursday, February 15th 2024, 8:34AM 1 Comment

by Jenny Ruth

ASB's latest financial results showed it effectively shut up shop on mortgage lending in the six months ended December.

Its half-yearly disclosure statement showed its on-balance-sheet mortgage book shrank by $518 million between June 30 and Dec 31 last year after growing by $674 million in the previous six months.

Year-on-year, the on-balance-sheet book was $156 million higher at $75.51 billion at Dec 31.

Shortt told TMMOnline that banking-system-wide mortgages grew 2% in the period. (Shortt was rounding the data because RBNZ data shows net new mortgage lending grew $5.18 billion, or 1.5%, in the six months ended December.)

“You would have to describe that has a very low-growth environment,” Shortt said.

“We've been quite clear about where we want to sit.  Our pricing  - It's been a fairly competitive market and that's in essence what the big change has been,”  she said.

“Mortgage brokers – the feedback we're getting from brokers is that they love the ASB service.”

But they also want fast turn-around times and “very competitive” pricing, and that hasn't changed, “that's a feature of the broker market,” she said.

“Over the last six months, they would've liked us to be more competitive on pricing.”

But ASB also had to deal with higher funding costs, with offshore funding costs rising more than the cost of domestic deposits, but that's also risen, Shortt said.

“We're chosing to manage our business in a way that we think is appropriate. It's a really competitive market and, in particular, it's low growth.”

Slides published by ASB's parent, Commonwealth  showed ASB's deposits grew 6.6% between December 2022 and December 2023 while deposits in the banking system as a whole were up 2.8% and that while home lending in the banking system as a whole was up 3% over that year, ASB's home lending rose just 0.2%.

ASB remains the only one of the big four Australian-owned banks that doesn't publish any information about how much of its mortgage book is originated by advisers.

Both ANZ Bank New Zealand and National Australia Bank-owned Bank of New Zealand publish the percentage of their total book originated by advisers and how much of new mortgages written in their reporting periods were written by brokers, while Westpac publishes only the former.

“We provide so much information. We just have to draw a line underneath it somewhere,” Shortt said.

However, Shortt did admit that the proportion of ASB's loans written by brokers has fallen but said “it's not that much of a material change.”

Every adviser wants the best interest rates. “I know that they haven't been happy with where we've been in terms of price, but it's a competitive market.”

Shortt isn't promising ASB's pricing will change. “We're always making adjustments and we've made some in the new year. But we've got to think about this business for the long term,” she said.

“We don't run our business on market share, you're right. Over the long term, we absolutely want to grow,” but market share may vary from month to month or in any given period.

Tags: ASB

« ASB's mortgage book shrank $518m from JuneASB has only 370 distressed home loan customers »

Special Offers

Comments from our readers

On 15 February 2024 at 2:01 pm Amused said:
“Mortgage brokers – the feedback we're getting from brokers is that they love the ASB service.”

Roll out the old ASB service proposition when all else fails. Unfortunately, what the ASB chief executive fails to understand is that ASB’s service levels to mortgage advisers (we aren’t called brokers anymore) and its customers were just the “icing on the cake” back when ASB were still actually competitive on both their home loan policy and pricing. Having a 35 day refix policy for your customers now on their home loan is far from competitive.

ASB turnaround times to advisers might be good but this is because they clearly aren’t getting much business from the adviser channel. This should be a real concern to ASB when it’s acknowledged 50%+ of new home loans now originate from mortgage advisers. As a lender if you aren’t focussed on such an important acquisition channel and ignore what advisers are trying to tell you about your policy and pricing don’t be surprised if your profit then drops.










Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.75 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.75 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.24 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.84 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.04 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.29 7.32 6.65

Last updated: 8 April 2024 9:21am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com