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Green shoots of recovery in wholesale markets: FirstMac

Staff Reporter 4 minute read

Brokers will welcome the news that competition may soon start to filter back into the market with early indications that wholesale market investors are returning.

FirstMac’s chief executive officer Kim Cannon has confirmed that wholesale markets are beginning to experience renewed interest from foreign investors.

The increased interest follows months of hesitation from investors, with the global financial crisis effectively freezing securitisation markets.

“Investors are reentering the market thick and fast now, however I believe it will be another six to 12 months before we see any marked improvement in the wholesale arena,” Mr Cannon told Mortgage Business.


While there is increased investor interest, Mr Cannon said the hardest task for non-bank lenders will be rebuilding consumer confidence.

“A lot of people were burned by GE because it didn’t stay in line with the majors. But we are trying to rebuild confidence in the non-bank sector and hopefully in time, we will rebuild the trust people once had in second tier lenders.”

FirstMac is currently in talks with the Australian Prudential Regulation Authority about obtaining a license that will allow also it to tap into the retail deposit market and diversify its funding base to maintain funding for borrowers.

“What the financial crisis has taught us is that we need to have access to funding other than securitised, because when that funding source freezes, we are left in a very vulnerable position,” Mr Cannon said.


Green shoots of recovery in wholesale markets: FirstMac
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