Major banks’ mortgage books soar as borrowers toy with swapping lenders

Federal Treasurer Wayne Swan says borrowers who are not satisfied with the response of the major banks to the December 6 rate cut should vote with their feet and switch lenders.

A move away from the majors to some of the second-tier lenders would certainly increase competition in the sector.

According to mortgage broker AFG’s November report, the major banks increased their dominance of mortgage lending, accounting for 80.4% of all loans processed, compared with 78.9% in October.

In addition, all the major banks delivered record profits this financial year, with Westpac earning $6.99 billion (10% up), the Commonwealth Bank taking home $6.1 billion (40% up), NAB earning $5.5 billion (19.2%) and ANZ earning $5.4 billion (19%).

Collectively that totals about $24 billion, greater than gross national products of Taiwan, the Czech Republic and Hungary, to name just a few.

For the millions of borrowers still waiting to hear how much of the RBA’s 0.25% cash rate cut the major banks will pass on, here’s a rundown of just how big their mortgage books are:

$304.2 billion

The size of the Commonwealth Bank mortgage book (including Bankwest)

$287 billion

The size of the Westpac mortgage book (including St George)

$174.7 billion

The size of NAB’s mortgage book

$160 billion

The size of ANZ’s mortgage book

$37 billion

The size of the ING Direct mortgage book

$29.6 billion

The size of the Suncorp mortgage book

$21.6 billion

The size of the Bendigo and Adelaide Bank mortgage book

$21.2 billion

The size of Bank of Queensland’s mortgage book

$7.2 billion

The size of the HSBC mortgage book

$7.1 billion

The size of Citibank’s mortgage book

$6.4 billion

The size of AMP’s mortgage book

$5.4 billion

The size of the Members Equity Bank mortgage book

$2.3 billion

The size of Macquarie Bank’s mortgage book

Source: APRA October 2011 monthly banking statistics