ANZ generates more profit for every dollar lent out in the domestic economy, compared with its rivals, while National Australia Bank has among the thinnest profit margins from retail lending.
However, NAB will seek to close the gap on its competitors when three of the big banks report profits in the coming weeks, after signalling it is no longer the price leader on mortgages.
ANZ, Westpac and NAB are set to notch up combined earnings of more than $9 billion during the upcoming bank profit season, which kicks off with ANZ's results this Tuesday.
A key focus of the results is likely to be the profitability of banks' domestic lending to households, after Commonwealth Bank's flagship retail bank underpinned first-half earnings of $3.78 billion in February.
For most of the past four years, ANZ's Australian division - which includes commercial lending - has posted the widest interest margins when compared with the retail businesses of the other big banks.
NAB has suffered the biggest fall in margins, after chief executive Cameron Clyne vowed to "break up" with the other big banks in 2011 with the lowest mortgage rates.
But Morningstar's head of Australian banking research, David Ellis, said the performance of NAB's retail arm was likely to gradually improve, after ditching its promise to have the lowest mortgage rates at the end of last year.
"They've intentionally been targeting low interest rate home loans," Mr Ellis said.
"That's an attempt to increase market share, but ironically, despite their very effective advertising campaign they've progressively been reducing that gap between the NAB home loan interest rate and the other banks."
Macquarie's bank analyst, Mike Wiblin, also said NAB's net interest margin could "surprise on the upside" when it reports profits on Thursday next week.
NAB passed on 40 basis points of the 50 basis points in official interest rate cuts of late last year, and analysts say this should support earnings.
ANZ, which analysts think will report $3.13 billion in cash earnings on Tuesday, may also report pressure on margins in its Asian business despite the healthy conditions in Australia.
Westpac, which reports its profits on Friday, could also benefit from its home loan pricing strategy. Mr Wiblin noted that its loan book has the highest weighting towards mortgages of the big four, at 68 per cent.
Westpac also passed on just 38 basis points of the 50 basis points in official rate cuts in late last year, and analysts estimate its cash earnings will hit $3.38 billion.
While the failure to pass on official cuts in full is benefiting the banks, lenders say their costs remain under pressure because they are aggressively competing to attract deposits.
In the heated environment of an election year, whether these higher costs are being outweighed by banks' mortgage pricing decisions is likely to be a key focus for investors, and the public.
"The net interest margin of their consumer banks and the home loan books is one of the most important drivers of overall earnings for the banks, particularly for CBA and Westpac," Mr Ellis said. "They've always been and will always continue to be very carefully managed."