Australia's Big Four Banks Shift Away from Mortgage Brokers: What It Means for Borrowers

Currently, mortgage brokers facilitate approximately 80% of new home loans in Australia, one of the highest rates globally. However, CBA, the most profitable among the four, originates the majority of its loans in-house. Following this model, NAB, Westpac, and ANZ are expanding their teams to enhance direct home lending capabilities, recognizing the more favorable returns from proprietary channels compared to broker-originated loans.

While consumers often prefer brokers for their ability to compare rates across multiple lenders, banks incur commission costs that can erode profits. The shift towards direct lending comes amid declining net interest margins, with the Big Four reporting a combined 4.5% drop in 2025 earnings to A$30 billion. Despite this, all banks have expanded their mortgage portfolios, with CBA's growing by 6% to A$664.7 billion.

For borrowers, this trend may lead to changes in how home loans are accessed and negotiated. Direct engagement with banks could offer more personalized service and potentially better rates, as banks seek to attract customers without intermediary costs. However, it also means that consumers may need to invest more time in comparing loan products and terms across different institutions.

In summary, the move by Australia's Big Four banks to reduce dependence on mortgage brokers reflects a strategic effort to enhance profitability and control over the lending process. Borrowers should stay informed about these changes and consider both direct and broker-assisted avenues to secure the most favorable home loan terms.