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Lender sees surge in broker business ahead of merger

by James Mitchell10 minute read

A leading mortgage lender has recorded a 21 per cent increase in branded mortgage settlements through the third-party channel in the 2016 financial year.

Listed non-bank lender Homeloans Limited this week released its annual report, in which the group highlighted the strength of the third-party channel.

“The volume of home loans originated by mortgage brokers remains strong, with this channel representing more than 50 per cent of all new loans acquired in Australia,” Homeloans CEO Scott McWilliam said.

“Given the relevance and importance of this channel in the home mortgage market, we remain focused on supporting and growing the existing relationships we have with our broker partners as a key component of our distribution strategy,” he said.


“As a result, total branded settlement volumes through the third-party channel increased by 21 per cent during FY2016.”

New funding partner

The award-winning non-bank lender, ranked first in the mortgage manager category of Momentum Intelligence’s Third-Party Lending Report: Non-Bank Lenders 2016, has a broad base of wholesale funding partners.

This group of partners includes Bendigo and Adelaide Bank, Advantedge, Pepper Home Loans, RESIMAC and Macquarie Group.  

Mr McWilliam noted that specialist lender, RedZed Lending Solutions became a new wholesale funding partner in the year to further broaden the Homeloans product offering.

“The diversity of funding relationships ensures we are able to constantly adapt our products, working with our funding partners, to maintain and strengthen our positioning in the mortgage market,” he said.

Major merger to strengthen proposition

On 20 July 2016, Homeloans entered into a Scheme Implementation Agreement with RESIMAC Limited, under which Homeloans will merge with RESIMAC subject to approval by the shareholders of both companies.

Mr McWilliam, said the proposed merger represents “an ideal opportunity for shareholders to benefit from an enlarged and more diversified combined business.”

“With an established pattern of delivering settlements growth through the current distribution structure, Homeloans is well-placed to further leverage, and build on, its relationships with brokers and retail networks,” he said.

“In a changing regulatory landscape, which has impacted investor and interest-only loans, non-bank lenders continue to establish their position as a viable alternative to the major banks.”

With its diversified funding base, Mr McWilliam believes Homeloans is well-placed to continue capitalising on these changes. He added that the proposed merger with RESIMAC, a leading non-bank lender with established product manufacturing and funding capabilities, will further accelerate the company’s ability to increase settlements and pursue other growth opportunities.

[Related: Fed court approves major mortgage deal]