ANZ: Most requests for help now come from NSW
Fully three-quarters of applications for assistance from home loan customers recently have come from New South Wales, currently in the grip of an extended lockdown, said Mark Hand, ANZ group executive for retail and commercial banking.
Hand said most requests for assistance from small business customers in July have also come from New South Wales and many businesses have already taken advantage of reduced repayments or have temporarily switched to interest-only payments.
Hand said while the average number of calls for help has risen in July compared with June, they are coming off a relatively low base and are still well below the peak seen at the height of the pandemic in 2020.
The executive said the bank always expected there would be greater demand on our hardship teams in the second half of this year after the initial government support programs tapered off.
"The situation has evolved significantly since federal and state governments, regulators and banks came together last year to address the first series of lockdowns,” he said, adding that some important lessons have been learned along the way that will help shape how the bank will support customers through this latest leg of the pandemic.
“Every customer’s circumstances are different, and a deferral may not be the best option for some of them. That’s because the money still has to be repaid so there could be implications for their credit status down the track,” he said.
No one-size-fits-all strategy
Hand said this time around the best strategy is not the one size fits all deferrals banks provided to thousands of customers last year.
“Many customers who took a deferral last year came out of the initial lockdowns in pretty good shape. At that time, there was so much uncertainty it was wise for customers to take advantage of deferrals because none of us knew what was coming around the corner,” he continued.
“Instead of the deferral option being like a cover-all insurance policy that everyone takes out, it will be option customers take out only if they really need it – like an extra lever we can add to our existing financial hardship price.”
The ANZ executive said there is a range of options available, including accessing funds in offset accounts, temporarily reducing repayments, or switching to interest-only payments for a period.
Small business customers can apply for a range of measures including up to 60 days repayment deferral on business loans, waiving merchant terminal rental fees, and fee-free access to funds held in business term deposits.
“While we’re not out of the woods yet, we are ready to work again with governments and regulators to make sure our customers not only survive this latest upheaval but emerge ready to take advantage of the rebound on the other side.