The third party channel at National Australia Bank (
NAB) has grown over the last financial year in terms of loan volumes, drawdowns and sheer broker numbers.
In its annual financial results released yesterday (2 November), the bank revealed it had recruited an additional 338 brokers across its aggregators PLAN, Choice and
FAST within the 12 months prior to 30 September. This brings the total number of brokers across the bank’s aggregation network to over 4,600.
Residential lending volumes for brokers increased by 12% to $98.5bn and drawdowns attributed to the third party rose by 42% during the same time period.
“We would like to thank each of our brokers and aggregators for their ongoing support. Strong growth in drawdowns through brokers, from 34.4% to 42% this financial year, demonstrates an incredibly important part of what we do as a bank,” executive general manager of NAB broker partnerships,
Anthony Waldron, told
Australian Broker.
These financial results reflect NAB's strategy to become the bank for brokers, he said.
“Our business is defined by great partnerships; with our aggregators who continue to do an excellent job in providing brokers with the right support to run and grow their businesses, and with our brokers who continue to provide the best experience for their customers.”
NAB’s total housing lending portfolio sat at $292.6bn at the end of September. Of this, 58.0% were owner occupied, 42.0% were investor, and 29.8% were interest-only.
The breakdown of each loan type as of 30 September is as follows:
| |
Principal and interest |
Interest only |
| Owner occupied |
46.3% |
11.7% |
| Investor |
18.5% |
23.5% |
Residential lending market share rose slightly to 15.7% while average LVR at origination sat at 69.0%.
The bank saw $8.4bn worth of loans converted from interest only to principal and interest. Of these, $3.5bn came from early conversions with those seeking to switch and take advantage of the lower P&I interest rates.
“We are actually keen to encourage people to go into principal and interest and we’ve seen a lot of switching from interest-only. Principal and interest rates are significantly lower than interest-only, so there’s a real incentive for people to move into those,” NAB CEO
Andrew Thorburn said during the financial results briefing.
Looking at loan defaults and arrears, 0.59% of the total loan portfolio were 90 days plus past due. At the other end of the spectrum, 72.5% of customers were more than one month in advance including those with offset facilities. On average, NAB’s home loan customers are 30 monthly payments in advance.
Cash earnings for the financial year sat at $6.6bn, up 2.5% from last year’s $6.5bn, while underlying profit grew 1.8% from $5.1bn to $5.2bn.
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