ANZ acquisition of Suncorp: what would it mean for the big four home loan share? 

ANZ could increase its share of Australia’s tightly held mortgage market by 17.7 per cent, if the bank gets the green light on its proposal to acquire Suncorp Bank. 

If approved, ANZ would leapfrog ahead of NAB to be the third largest home loan lender, despite the fact NAB recently acquired Citibank’s consumer banking business in Australia.

According to APRA data, ANZ currently holds 13.1 per cent of Australia’s home loan market, among authorised deposit-taking institutions (ADI’s), worth around $261.06 billion dollars. 

Suncorp’s share is a more modest 2.3 per cent, or $46.21 billion, according to the Monthly Authorised Deposit-taking Institution Statistics from May 2022. Together, this would see ANZ’s total home loan book increase to approximately $307.27 billion, or 15.4 per cent, based on the May figures.

However, ANZ has said Suncorp would continue to operate under its existing banking license, at least initially, with a commitment to not to make changes to the total number of Suncorp Bank branches in Queensland for at least three years from completion.

ANZ would still be a long way behind the biggest lender, CBA, which has more than a quarter of home loans held by ADIs. 

Big four share of ADI home loans – if Suncorp acquisition is approved

Source: APRA monthly ADI statistics May, released 30 June 2022.

RateCity.com.au analysis shows in the past two years there have been a number of mergers. Some key deals include: 

• NAB acquired Citi’s consumer business in Australia in June 2022.
• NAB acquired 86 400 in December 2021 and transitioned its customers to the ubank brand in May 2022.
• Bank of Queensland acquired ME Bank in 2021. The two brands are currently still in operation. 
• IMB Bank acquired Hunter United in 2020. Hunter United now operates as IMB.

Three new home loan lenders have entered the market in the past two years, including One Two Home Loans, Nano and WLTH, while CBA launched its new home loan platform Unloan in May 2022.

RateCity.com.au research director, Sally Tindall, said: “If ANZ acquires Suncorp, it will be on track to have the third largest share of home loans in Australia.”

“The big four banks already have a giant slice of Australia’s home lending market. If the deal goes ahead, together they could hold a whopping 77.8 per cent of residential mortgages among Australia’s ADI’s. 

“While the big banks have a stronghold on Australia’s lucrative mortgage market, it’s not because of a lack of choice. There are around 120 home loan lenders in the market, plenty of which offer more competitive rates than the big four.

“Australia’s mortgage market is awash with lenders willing to offer new customers a better deal. With interest rates on the rise, now’s the time to use this competition to your advantage.

“If you’re on a variable rate, it’s your right to take your home loan shopping whenever you see fit. There’s typically a discharge fee, a handful of relatively minor government fees and potentially an application fee from your new lender, however, customers can often find themselves ahead as a result of the interest saved in a matter of months,” she said.

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