The profit in home lending

by David Richardson

The purpose of this brief is to estimate the profit earned on mortgages by the ANZ Bank, the Commonwealth Bank of Australia, the National Australia Bank and the Westpac Banking Corporation known as big four banks. The method here is to estimate the average profit margin on bank home loans and then to apply that to the amounts people are borrowing at the moment. The estimates here are based on the data presented in Table 1 which in turn are based on statistics published by the Australian Prudential Regulation Authority.

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