Mortgage war bites

Jenny Ruth

Thursday 1st September 2005

ANZ National Bank's net profit fell and it continued to lose market share in the mortgage market during the June quarter despite its mortgage book growing by $1.02 billion to $37.18 billion, its general disclosure document shows.

Its market share dropped from 35% at the end of March to 34.7% at the end of June using Reserve Bank figures.

The bank's net profit fell 12% to $169 million compared with the June quarter last year. It says solid asset and deposit growth was offset by "reduced net interest margins from earlier intense price competition and the run-off of structured finance transactions."

Its net interest margin was down 17 basis points to 2.56% compared with the June quarter of 2004 and it was down seven basis points from the March quarter this year.

"In a difficult environment, this is a credible performance in line with the sector," says chief executive Sir John Anderson.

The bank also incurred increased amortisation and integration costs in the quarter. Bank of New Zealand and Westpac's GDS's last week showed their profitability has also suffered.

While the other major bank, ASB Bank, has yet to release its June quarter GDS, early in August it reported its after tax operating profit by 21% to $382.8 million for the 12 months ending 30 June 2005.

It also claimed increased lending volumes and market share.

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