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The latest Broker Pulse: Commercial Lending report by Agile Market Intelligence has revealed that the major banks are winning ground when it comes to broker-lodged loans for commercial clients.
The survey reveals insights from Australia’s commercial brokers and highlights the key lender movements across usage, service, loan processing times, and broker experience.
According to the survey from 1–25 November – which gathered feedback from 124 active commercial brokers about the commercial mortgage lenders they had used over the month of October – the major banks are increasingly favoured by brokers for commercial loans.
In the past three months, a significant percentage of brokers have opted to submit applications to the majors for their commercial, business, and asset finance loans.
Commercial mortgages
Australia and New Zealand Bank (ANZ) was the most commonly used lender by brokers for commercial mortgages, having a 27 per cent broker usage.
National Australia Bank (NAB) followed in second place, with 25 per cent of brokers using them for their clients needing commercial mortgages, while Westpac rounded out the top three with a broker usage rating of 22 per cent.
For business loans, the four majors had also seen the most applications. NAB was found to be the top business lender for business loans, with 25 per cent of brokers submitting capital applications to this bank.
Westpac and ANZ follow behind at 23 per cent and 21 per cent, respectively. The fourth spot was taken by the Commonwealth Bank of Australia (CBA), which had 13 per cent broker usage over the month of October.
Asset finance
Meanwhile, Westpac was the most used lender for asset finance loans, with 34 per cent of brokers saying they had lodged an asset finance loan with the bank in October.
Although majors occupy the top three slots for commercial and business loans, non-bank lenders show fierce competition, with many of them occupying spots in the top 10 for each loan type.
Asset finance, in particular, shows the most competitive space for non-bank lenders, with only Westpac making it to the top three. This reveals that although majors dominate commercial and business loans, non-bank lenders have a significant grip on brokers applying for asset finance loans.
Angle Finance was a popular asset finance choice for brokers, with a third of respondents saying they had lodged a loan with them, followed by Metro Finance (at 31 per cent).
Part of the reason for the popularity of these lenders may be their turnaround times. According to the Broker Pulse survey, non-bank lenders showcased the fastest turnaround times in the past three months.
Angle Finance ranked first, taking less than one business day to reach an initial credit decision. Metro Finance and Capital Finance follow suit, with each having turnaround times of one and 1.1 days, respectively.
Of the majors, Westpac had the shortest turnaround time, taking 1.4 days. The other three big four banks had much slower processing times, with ANZ in particular having the longest turnaround time of five days.
The findings come as all four major banks push deeper into the commercial lending space, particularly through the broker channel. All the big four banks have been eyeing commercial finance as a means of improving margins and accelerating loan growth, with several having rolled out new technological improvements to accelerate the time to yes.
The performance of the latter two implies that – for vehicular and equipment mortgages – the non-bank specialists are particularly popular.
You can find out more about the Broker Pulse: Commercial Lending and Broker Pulse: Residential surveys at www.brokerpulse.com.au.
[Related: Finance Specialist: How technology is revolutionising commercial lending]