One of Australia’s biggest mortgage aggregators, Australian Finance Group, says its brokers lodged 61.8 per cent of their loan applications with major banks during the March quarter – an increase of 2.2 percentage points over the previous quarter and the highest share for the big banks since the June quarter in 2020. AFG chief executive David Bailey said the growth in share was driven by the big banks “continuing to benefit from lower funding costs linked to the government’s Term Funding Facility, a lag in passing on deposit rate increases to customers and the prevalence of sub-economic cashback offers”. Bailey said: “The longer-term consequence of this situation is that smaller lenders will continue to be squeezed, impacting choice and competition for Australian borrowers, and will ultimately result in higher real long-term borrowing costs for Australian home buyers. “The restoration of an even playing field for non-major lenders is vital to ensure alternative lending options.” AFG’s business reflected the slowdown in mortgage lending, with a 3.3 per cent fall in lodgements during the quarter and an 11.7 per cent fall over the same period last year. Lodgements for investors and first home buyers increased during the quarter. Bailey said one positive from the slowing market was improved approval turnaround times. The average number of days from the submission of a loan application by an AFG broker to formal approval came down from 17.9 days to 17.7 days.