Commonwealth Bank (ASX:CBA) is retracting its presence in the mortgage market resulting in a decrease in its book, according to a recent analysis by Citi research.

This move is anticipated to have positive implications for its competitors.

Westpac, in particular, has stepped in to fill the vacuum left by Commonwealth Bank, becoming a key driving force in the growth of banking system’s lending.

The analysts have also pointed to potential shifts in the market due to variations in timing differences between cashbacks.

Despite this development, the analysts suspect funding constraints and dropped demand momentum, remaining for the year, will not bring about a major competitive breakout.

The intuitive impact is that the change in the mortgage market will ease off, but the analysts do not foresee a significant competitive shift from Commonwealth Bank.

As per the last closing figures, shares of Commonwealth Bank have witnessed a decline of 4.4% YTD.

Commonwealth Bank is one of Australia’s leading banking institutions with primary operations in retail and institutional banking.