He puts his bank's share of the mortgage market at 16.2%, based on Reserve Bank figures, unchanged from a year ago.
"What we've always said is that we want to write profitable business. That's what we've done," Thodey says.
"We write about 25% of all the non-broker business. Because the average duration is two-year fixed, our competitors are paying away their margins to brokers," he says.
BNZ hasn't dealt with mortgage brokers since 2003, although its share of broker originated business before that was minimal.
The bank kicked off its "Unbeatable" campaign, credited with starting the current price war, in November 2004.
"If we can increase market share, we will, but we're not going to do it at the cost of profitability."
Thodey says although BNZ's competitors' published rates are higher than BNZ's, they are in fact matching his bank. "They also pay brokers. There can only be one winner in all that and it happens to be us."
While BNZ's interest margin has declined eight basis points, the published results of ANZ/National Bank puts its margin decline at 26 points and Westpac's at 25 points, he says.
BNZ's chief financial officer Mark Hosking says his bank participates in only 70% of the total mortgage market (brokers account for about 30%) so holding its market share steady means "you must be holding well above your market weight."
Thodey says mortgage market growth continues in double digits, against expectations that it would have slowed to 9% or 10% by now. "It's slowing, but much more gradually than anybody expected." He also expects general economic growth to be "not bad for New Zealand" at about 1.5%, or maybe as high as 2% over the next year.
BNZ reported a 7.6% rise in first-half net profit to $270 million. However, its second half net profit slipped to $131 million from $134 million in the previous second half and from $139 million in the first quarter.
