Analysis of the Australian Competition Tribunal decision to unblock the $4.9b deal shows it was convinced more scale would help ANZ be a better competitor.
Already a subscriber?In the mortgage war era, evidence of banking competition has mostly focused on loan pricing. But the Australian Competition Tribunal seized on a different type of warcraft: lenders are embroiled in a technology arms race., the tribunal recognised banks are aggressively pursuing more nimble, digital-only strategies centred on their apps, hoping to entice customers and keep a lid on costs.
ANZ has poured $1 billion into its new technology platform, ANZ Plus, over the past three years. But it still lags the “maverick” rival Macquarie in terms of home loan growth.ANZ’s mortgage market share fell from 14.1 per cent in January 2020 to 13.5 per cent as of last month. Over the same period, Macquarie boosted its share from 2.6 per cent to 5.3 per cent. Both are a long way from market leaders, Commonwealth Bank and Westpac .
“The increased scale of the major banks compared with the regional banks enables them to spend significantly more on technology and provides them with a material competitive advantage, in both price and non-price dimensions of competition.”
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