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St.George open to expanding ‘no LMI’ policy to brokers

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James Mitchell 5 minute read

St.George Bank has revealed that it is open to adding additional sectors to its current LMI policy for medical professionals.

Speaking at the St.George Bank Flame Forum 2015 in Melbourne this week, St.George Bank head of credit Rob Love said that the group’s Medico policy has been a key differentiator in a competitive market.

“We see others in the market starting to follow on our tail a little more closely,” Mr Love said. “We will look to refine that over time."

Under the current policy, borrowers who meet the definition of a medical professional (Medico) can receive a 90 per cent LVR home loan without LMI.

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The arrangement has led to a “tremendous amount of business” and “very strong quality business” for the St.George Group, Mr Love said.

“If we can add additional sectors into that policy with proven performance then they are the type of opportunities we are looking to deliver on and should deliver on,” he said.

Flame brokers attending the event on Monday suggested that St.George could extend its policy to include them as candidates for a mortgage at 90 per cent LVR without LMI.

“We certainly can look and will look at the Flame broker set as an option of an industry sector [eligible for the policy],” Mr Love said, adding that the bank must ensure that it recognises the right risks to bring onto its book.

“Particularly in the current market, that is quite heightened at the moment in terms of price appreciation.”

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Mr Love noted that St.George Bank’s delinquency rates in the LMI space are double that of the portfolio average.

“So it is a higher risk segment,” he said. “We have to be really clear on what elements of the through-the-door population that we would apply that policy to.”

[Related: Mortgage changes will be constant, says broker head]

St.George open to expanding ‘no LMI’ policy to brokers
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James Mitchell

James Mitchell

James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.

He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.

He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.

James holds a BA (Hons) in English Literature and an MA in Journalism.

 

 

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