ANZ has faced claims that its long-standing mortgage customers were being used to subsidise new customers as the bank looks for growth in a slowing credit market.
JPMorgan banking analyst Scott Manning said ANZ had been among the most aggressive when it came to offering discounts for new customers.
While headline mortgage rates have been rising, banks have quietly been competing on new mortgages to maintain growth in the face of a sharp slowdown in the housing market.
JPMorgan figures show ANZ was offering new mortgage customers up to a 110-basis-point discount off the headline rate of a new home loan. This compares with a discount of about 90 basis points offered by other major banks.
”It does support our view that repricing of the back book is being used as a mechanism to subsidise elevated levels of discounts offered on the front book to deliver housing credit growth,” Mr Manning said.
ANZ yesterday disputed claims it was subsidising new mortgages. ”There has been some discounting across the industry, which we recognised was not sustainable for ANZ some months ago,” a spokesman said. ANZ has said the out-of-cycle rate move was needed as funding pressures, including the pricing of deposits, were pushing up the bank’s costs.