Auswide book grows as broker flows increase

The First Home Loan Deposit Scheme (FHLDS) reportedly contributed to a 9.9 per cent increase in home loan settlements and a 25.8 per cent increase in approvals.

While the majority of its total book comes from its home state of Queensland, the bank reported particular growth in Western Australia/Northern Territory (up 17.1 per cent to 5.2 per cent), NSW (up 8.2 per cent to 11.9 per cent) and Victoria (up 5.5 per cent to 8.0 per cent).

According to the bank, this was driven by “strong broker flows” in these states.

While the lender saw a 3.5 per cent increase in mortgages (making up just over 93 per cent of its total loan book), it reported a marked rise in consumer lending, which was up 29 per cent to $80 million. Business lending also grew over the last financial year to $136 million (up 11.5 per cent).

Overall, the bank reported that net profit after tax (NPAT), excluding the effects of COVID-19, increased by 16.9 per cent to $20.1 million, reflecting a 10 basis point improvement in net interest margin and a lower cost-to-income ratio.

Statutory NPAT came in at $17.2 million, up 7.6 per cent on last year.

Speaking after the financial results were released, Auswide Bank’s head of third party, Tracy Field, acknowledged that the broker channel had helped bolster its growth both in FY20 and into the new financial year.

Ms Field revealed that Auswide had experienced record lending approvals in August, particularly from third-party-originated loans. 

“Breaking a monthly lending record is significant for a lender with a 54-year history. We started on a journey in May last year by listening to our broker partners who assisted in a full third-party channel review, and I am pleased to be able to say that we have seen continued improvement and growth of inflows as a direct result,” she said.

“As we roll out several more technology pieces designed to further improve experience and turnaround times in Q2 and Q3 this year, our team looks forward to engaging with even more of our broker partners.” 

Reflecting a broader trend, Ms Field said that brokers had also contributed to the bank’s FHLDS loan uptake, adding that Auswide is expecting to utilise its full allocation from the current tranche over the next few weeks. 

“We are very grateful for the support we have been receiving from our broker partners under the scheme, as this has allowed us to align to one of our core goals: supporting everyday Australians to achieve home ownership,” Ms Field commented. 

However, she added that the bank also attributed the popularity of the scheme to the “simplicity of [the bank’s] reservation process and being able to confirm a scheme place reservation generally within four hours”.

[Related: Brokers dominate FHLDS originations]