Bank of Queensland's (BOQ) acquisition of ME Bank briefly turned it into a genuine mid-tier mortgage force. It has spent the two years since trying — and failing — to hold that ground, with APRA data showing the bank's home loan book in continuous decline since early 2023 and its market share falling to its lowest point in the data series.
BOQ's residential mortgage book stood at $52.5 billion in March 2026, down from a peak of $60.6 billion in February 2023, a reduction of $8.1 billion, or 13.4%, in just over three years. Its share of the national mortgage market has fallen from 3% in March 2022 to 2.13% today, erasing most of the competitive ground gained through the acquisition.
The decline has been persistent. From its peak in February 2023, the book fell in the majority of subsequent months, with only brief and shallow interruptions — a small uptick in late 2023 and a three-month stabilisation in early 2024 — before resuming a consistent downward trend. From July 2024 through to March 2026, the decline has been unbroken across 21 consecutive months.
ME Bank's integration into BOQ was completed in early 2022, and its impact on BOQ's APRA-reported figures was immediate and dramatic. BOQ's mortgage book jumped from $33.1 billion in January 2022 to $58.6 billion in February 2022 as ME Bank's balances were consolidated onto BOQ's register. That's an increase of $25.5 billion that pushed the bank's market share from 1.68% to 2.97%.
For a brief period, BOQ appeared to have executed a transformational deal. At its February 2023 peak, the combined book reached $60.6 billion and market share touched 2.91%. But the organic performance of the combined business since that peak has been poor. Rather than using ME Bank's digital infrastructure and younger customer base as a platform for growth, BOQ has watched its book run off month after month.
The absolute numbers tell the story plainly: between the February 2023 peak and March 2026, BOQ shed net mortgage balances every single month, a cumulative reduction of $8.1 billion while the overall market grew by more than $400 billion.
Several factors explain BOQ's sustained decline. The bank has faced ongoing questions about the integration of ME Bank's technology stack, which was built on a different core banking platform. Brokers who used ME Bank's platform before the acquisition have noted changes to credit policy and turnaround times post-integration that made the combined entity less competitive than the sum of its parts.
BOQ has also been navigating a period of significant strategic uncertainty. In April 2025, the bank doubled down on its move away from the broker third-party channel, redirecting attention to its proprietary network and pausing the BOQ-branded broker channel. BOQ Group General Manager Johnny Lockwood told Australian Broker at the time that: "BOQ's broker brand remains paused, and we'll continue supporting existing customers with their lending needs."
The bank operates across multiple brands — BOQ, ME Bank, Virgin Money Australia and BOQ Business — which creates complexity in broker engagement and product positioning. A lender offering four brands to the broker market requires clear differentiation between each, and there has been consistent market feedback that this differentiation has not always been well articulated.
The broader competitive environment has also not been kind to mid-tier lenders. Macquarie's relentless expansion in the broker channel, combined with the major banks' sustained investment in turnaround times and digital approval tools, has left lenders like BOQ competing for volume in a market where the price of being even marginally slower or less competitive on rate is rapid book attrition through refinancing.
At $52.5 billion, BOQ's mortgage book is now barely larger than it was immediately after the ME Bank balances landed on its register three years ago. Its 2.13% market share is the lowest in the back-series data, and the monthly rate of decline, while slowing slightly, has shown no sign of reversing.
By contrast, Bendigo and Adelaide Bank, BOQ's closest comparable in the mid-tier segment, has maintained its book more steadily, holding around $64 billion in March 2026 and roughly stable market share. ING, another mid-tier competitor operating entirely through the broker channel, has grown its book to $72.9 billion.
For BOQ, the immediate challenge is stabilisation — stopping the outflow of existing customers through refinancing — before any genuine growth story can be told to the market. BOQ CEO Patrick Allaway said in the bank's full-year FY25 results that the year would "represent the peak in our mortgage portfolio contraction," pointing to the phased rollout of its new digital mortgage platform as the catalyst for recovery. But Allaway's subsequent departure and the appointment of a new CEO in January 2026 added further uncertainty, and the most recent first-half FY26 results showed the book had contracted a further $2.24 billion, down 8% year-over-year, with no sign yet of the stabilisation management had promised.
