Australia's banking sector is 'still competitive'
Australia’s financial system remains competitive despite the continued growth of the big four players, it has been claimed.
He noted that the four largest lenders in the country have increased their mortgage market share from 60 per cent to 82 per cent since the start of the financial crisis.
However, according to treasury secretary Ken Henry, despite the recent funding problems faced by financial intuitions, a number of smaller lenders are still managing to offer competitive homeowner loans – sometimes an entire percentage point below the home loan rates found at the major lenders.
Speaking at a conference in Canberra, Dr Henry said: "As global financial markets continue to recover, we expect to see competitive pressure in the banking sector rebuild."
He added that the Australian financial sector had benefitted from diversification.
"As the price of intermediated credit increased, businesses elected to diversify their funding," he added.
Recent research from the Australian Bureau of Statistics showed that the number of home loan approvals fell by 7.9 per cent during January.
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