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Mortgage veterans eye brokers following latest acquisition

by James Mitchell5 minute read
Patrick Tuttle

Former Pepper Group CEO Patrick Tuttle said that the third-party channel will be integral to the growth strategy he has planned for the SME lender he acquired last week.

On Friday (22 September), Mr Tuttle and fellow Pepper alumnus David Holmes, along with ex-Virgin Money treasurer Philip Sullivan, acquired SME loan provider Little Lease Company for an undisclosed sum.

It was the first time the small-ticket asset-backed lender has changed hands in almost 20 years.

Mr Tuttle told The Adviser that he will be focusing on “industrialising” the company’s existing processes, with a view to partner with aggregation groups.

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“David [Holmes] and I have deep relationships across the finance broking and aggregator space,” Mr Tuttle said. “In time, we will look to expand the offering among brokers.

“What we are not going to do is rush that. We don’t want to inundate the staff, so we will get in early and beef up policy and procedures.”

Little Lease Company finances smaller ticket items to small businesses, something the major banks typically haven’t had much appetite for. For this reason, Mr Tuttle said that SMEs should be on every mortgage broker’s radar.

“Brokers need to be thinking beyond their core offering. You never know when there is going to be volatility in the housing market. Small business will continue to grow as a segment in the economy.”

Mr Tuttle and David Holmes, Pepper’s former COO, have a wealth of experience in the home lending and securitisation markets. It is worth noting that their first move since Pepper should be in business lending, rather than mortgages.

“We actually think there is a huge opportunity in the SME space going forward. The demographics are going that way. More and more people want to be self-employed,” Mr Tuttle said.

“What we can do over time is leverage our experience in things like self-employed mortgages. We clearly know that self-employed market. We could white-label those products because we will be seeing those SME customers in our business.”

Established in 1999, Little Lease Company originates new business from various sources, primarily through finance brokers operating in every state and territory in Australia, as well as through repeat business with long-standing customers.

The business was originally acquired by its outgoing shareholders in 1998 from Metway Bank.

Co-owner David Holmes, who stepped down as Pepper’s COO earlier in the year, said: “The credit quality of the loan book is very strong, providing us with a solid foundation from which to further industrialise the platform and grow market share through diversified distribution channels, particularly our national finance broker network, and through the establishment of a small number of bespoke vendor financing arrangements.”

[Related: SMEs increasingly concerned about cash flow]

patricktuttle

James Mitchell

James Mitchell

AUTHOR

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

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