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· Posted on
February 21, 2024

ANZ gains market share in the mortgage tug-of-war but investors are worried its a fire sale

ANZ has joined the $7 billion club with a record $7.4 billion in profit.

What's the key learning?

  • ANZ is trying to claim back market share in the mortgage game.
  • For a bank like ANZ to grow market share, it needs to have a pretty compelling 'offer', and that means low interest rates on their home loans.
  • There is a delicate balance between market share growth and profitability in the banking sector.

👉 Background: ANZ Bank is the fourth of the Big 4 banks to announce their full year results for the last financial year. The other three banks have all recorded net profits of more than $7 billion for the past 12 months.

👉 What happened: Now, ANZ has joined the $7 billion club with a record $7.4 billion in profit. But, despite this record result, investors are still concerned about ANZ's future.  

👉 What else: ANZ is trying to claim back market share in the mortgage game. And that has meant undercutting the other banks on pricing and cutting their own net interest margin.

What's the key learning?

💡There is a delicate balance between market share growth and profitability in the banking sector.

💡For a bank like ANZ to grow market share, it needs to have a pretty compelling 'offer', and that means low interest rates on their home loans. And when their interest rate offer is lower than competitors, it means their margin is also squeezed.

💡While ANZ grew their market share and added more than $11 billion in home loans over the past 6 months, it also saw its 'new interest margin' drop by 0.1%.

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