ANZ Bank (ASX:ANZ) Launches Fresh Offensive in Mortgage Battle

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ANZ is adding lower-cost digital home loans to its wider arsenal as it looks to grab a bigger slice of the $2.1 trillion mortgage market, as banks continue to compete fiercely to poach each other’s customers.

ANZ, regarded as a key aggressor in the mortgage wars, on Monday hit a key milestone aimed at bolstering its position in retail banking, by launching automated digital-only home loans on iPhones, a move that brings it into direct competition with digital banking rivals.

ANZ retail group executive Maile CarnegieCredit: Louie Douvis

The bank’s digital home loans, which it has previously flagged, are initially only available to a narrow group of owner-occupiers who are refinancing and meet various other criteria, including that they live in NSW or Victoria.

But ANZ’s group executive in charge of Australian retail, Maile Carnegie, said ANZ planned to ultimately roll out digital home loans to much more of the home loan market, including property investors, and it would also look to distribute the loans via mortgage brokers.

The bank’s digital home loans currently have an interest rate of 6.14 per cent, which is 0.3 percentage points below rates that the core ANZ brand is offering for customers who are refinancing and have loan-to-value ratio of 60 per cent or less. This is higher than the rates being offered by Commonwealth Bank’s digital loan, which was launched in May last year.


It is about 18 months since ANZ launched its ANZ Plus platform, a major investment that the bank views as its future retail bank. Until now, the digital offshoot has focused on savings and transaction accounts, but the idea is it will provide a cheaper and more flexible way to run the retail bank in the future.

In a media briefing, Carnegie said the overall cost of serving customers on the digital platform was about 20 per cent lower than for the rest of the bank, and this would be reflected in its pricing. Amid debate in the investment community about ANZ’s strategy of aggressive growth in home loans, she also emphasised that shareholders would need to make an appropriate return.

“It’s going to be more competitively priced over time because it’s lower cost,” Carnegie said.

(The following story may or may not have been edited by NEUSCORP.COM and was generated automatically from a Syndicated Feed. NEUSCORP.COM also bears no responsibility or liability for the content.)

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