Resimac Group has conceded that it is struggling to remain competitive in a fiercely competitive mortgage market. 

The non-bank lender reported that the value of its home loan book fell from A$15.3 billion at the end of June to $15 billion at the end of October.

Home loan settlements over the four months were $1.8 billion. Settlements in the six months to June were $2.8 billion.

Resimac described competition for home loan originations as “fierce”, particularly in the prime loan end of the business where lenders are offering cashback incentives.

Its home loan net interest margin was 1.61 per cent in the four months to October, impacted by higher bank bill swap rates, which are the benchmark rates for its funding, and higher issuance margins.

The 2021/22 NIM was 1.81 per cent.

Its asset finance business performed better, with the value of the book growing from $400 million to $480 million over the four months to the end of October. Settlements over the period were $135 million.

Another positive was that arrears and hardship rates remained low across all product segments.