NAB targets 1-hour loan approvals in big four mortgage processing war

National Australia Bank chief executive Ross McEwan has said the lender is aiming to approve mortgage applications for home loans in as little as one hour, as it looks to speed up processing times to capture a bigger slice of profits from the soaring property market.

During NAB’s annual general meeting on Friday where shareholders grilled the board on culture, financial crime compliance and fossil fuel financing, Mr McEwan said two-thirds of applications for mortgages made with the bank were now approved within one day, but there was more work to do to reduce approval times even further

The comments came after rival ANZ Bank’s leadership this week was again forced to concede failures after sluggish approval times caused it to lose market share, with the latest figures confirming ANZ takes 10 days to approve simple home loans with lenders mortgage insurance and 32 days for complex loans.

As the banking industry faces competition from fintechs and buy-now-pay-later players, the majors have scaled up investment in technology and automation to cash-in on Australia’s booming property market fuelled by cheap debt and high savings during lockdowns.

“We’ve been able to speed up unconditional approval times on home loans, to give close to two-thirds of retail network customers an answer within a day,” Mr McEwan said.

“Our priority is to better use data to make lending decisions faster and improve our customer experiences, in an increasingly digital and automated world. We want to make unconditional home loan approvals within an hour the standard for NAB customers.”

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During the meeting, shareholders asked multiple questions about NAB’s corporate culture and wage underpayments after a damning report by the Finance Sector Union revealed serious mental health impacts among middle management. Chair Philip Chronican said NAB had taken the report “very seriously” and improving culture was a long-term process.

“We have not declared victory,” Mr Chronican said. “The board do not expect excessive overtime to be part of the story at NAB.”