AMP Bank's Loan Book Slips: What It Means for Borrowers

AMP Bank's half-year results show its loan book dipped to $23.73 billion — and the competitive pressure driving that could benefit you.

When a bank's mortgage book shrinks, it says something worth listening to about the competitive dynamics in the lending market. AMP Bank's latest half-year results tell exactly that story — and for borrowers who look past the headline, there are real opportunities to act on.

AMP Bank, the retail and specialist lender within the AMP Group, reported that its total loan book declined to $23.73 billion in the first half of 2026, down from $24.10 billion in the second half of 2025, though still modestly above the $23.52 billion recorded at the same point last year.

The Adviser reports that the softening was concentrated in two areas: residential mortgages, which slipped to $23.61 billion from $23.92 billion in the prior half, and business finance lending, which pulled back more sharply to $127 million from $176 million in the second half of 2025 and $195 million in the first half of 2025.

Competition in the Mortgage Market Is Running Hot

AMP Bank named the reason directly. "Lending was stable on the prior period with competition in the mortgage market offset by an increase in higher return segments," the bank stated in its results.

That single line tells you a lot. When a well-established lender cites competitive pressure as a key factor in its loan book movement, it's a signal that the battle for borrowers across Australia's mortgage market is intense. Net interest margin — the spread between what banks charge borrowers and what they pay for funds — slipped by 1 basis point to 1.25%, down from 1.26% in the prior half. AMP Bank's underlying net profit after tax for the half fell to $20 million, compared with $30 million in the first half of 2025.

For borrowers, competitive pressure between lenders translates into better pricing, more flexible terms, and sharper offers for refinancers. If you haven't reviewed your home loan recently, the bank's own results are a useful reminder that the lender who gave you the best rate two or three years ago may not be the most competitive option today.

The broker channel remains dominant in AMP Bank's new residential lending, with 94% of new home loans originated through mortgage brokers — only marginally below the 95% recorded in both prior halves. This tracks with the broader industry trend: more Australians are using mortgage brokers to navigate a complex market rather than walking into any one institution's branch.

Arrears and Loan Quality: Reading the Numbers Correctly

A modest uptick in arrears is worth understanding in context. AMP Bank's mortgages 30-plus days in arrears rose to 1.19% in the first half of 2026, from 1.17% in the prior half. The 90-plus day arrears rate moved from 0.69% to 0.71% over the same period.

These are small moves, and they need context to be read correctly. The 1.19% arrears rate sits well below the 1.44% recorded in the first half of 2025, meaning that year-on-year loan quality has actually improved despite the recent half-on-half uptick. Total bad debts written off across the residential and business finance portfolios came to just $1.4 million for the half — a modest figure against a nearly $24 billion book.

Dynamic loan-to-value ratios improved to 53% from 55%, while the weighted average LVR across the existing portfolio sits at 63%, slightly up from 62% in the prior half. Within the home loan book, 40% of balances are investor loans and 60% are owner-occupier, while 20% of mortgages are on interest-only terms and 80% are principal and interest. The funding mix comprised 61% deposits, 6% wholesale funding and subordinated debt, 30% securitisation, and 3% equity reserves.

For existing borrowers, the improving LVR figures are a useful prompt. If your property has grown in value since you took out your loan, your effective LVR may have improved materially — and that can unlock access to lower rate tiers, or allow you to refinance without lenders' mortgage insurance that you would have faced at the time of your original application.

What This Means If You're Considering a Refinance

AMP Bank's results are a snapshot of a market where lenders are competing hard for borrowers' business. That's a good environment for anyone willing to do a little research.

If your home loan is more than 12 months old and you haven't had a rate review, use our refinance savings calculator to see what switching to a lower rate could save each month — and over the life of your loan. Browse home loans available for refinancing to understand what today's competitive offers look like across the market.

With three cash rate rises in 2026 pushing variable rates higher and the official cash rate now at 4.35%, most variable rate borrowers are under pressure. But competition between lenders means pricing gaps do exist — and for borrowers prepared to shop around, those gaps represent real savings. If your LVR has improved as your property has grown in value, you may also have access to rate tiers that simply weren't available to you when you first took out your loan.

*Source: The Adviser*