Big banks benefit again

KPMG’s Australian Major Banks Full Year 2023 results analysis finds that the majors reported a combined cash profit after tax from continuing operations of $32.5 billion, up 12.4 percent compared to FY22.

This is unsurprising given the increasing interest rates have driven up mortgage repayments, most of which flow to the big four.

However, recent research by Finder has discovered that during the ongoing cost of living increases, more people say they are banking with the big 4 than when they started the survey in 2019.

That equates to 4 in 5 Australians or 16.2 million customers. This has been rising since January 2022, when 71% said they banked with the major banks.

It would appear that in times of financial instability and uncertainty when consumer confidence is low, individuals are more likely to look to what they perceive are safer options.

The big four are seen as very large, stable financial institutions and a safe harbour when there is a stormy financial environment. This perception may be further reinforced by the recent coverage in 2023 of bank failures in the USA, such as Silicon Valley Bank, as well as the collapse of builders in Australia.  

But while this is a natural response to feel protective of your finances when times are uncertain, you may be missing out on cheaper products and lower interest rates.

It may be worth remembering, that deposits of up to $250,000 in Australian institutions are protected by the Government Guarantee.

There are over 35 lenders on the Mortgage Choice panel, all of which have been vetted to the highest standards and provide a wide range of products and services. This includes low-rate home loans, personal and car loans and debt consolidation.

By going directly to your bank for a home loan, you are missing the opportunity for savings. And that is extra money that could be better used elsewhere in your family budget.

As with all products it pays to shop around.

But that can be painful and time consuming, so let me do it for you!

Whether it be your first home, 2nd home or an investment property, I’ll review all of our 35 + lender’s products and provide you with a recommendation and why that is best for you.

Feel free to call on 0418 552 938, or book a strategy session anytime.