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Bendigo profit surge positive for second tier lenders

by Staff Reporter11 minute read

In a further sign that the second tier lending sector is strengthening, Bendigo and Adelaide Bank has delivered a strong cash profit for the six months to 31 December 2009.

The regional lender yesterday announced an impressive cash profit of $139.7 million, 24 per cent above the prior calendar period.

The bank's general manager third party mortgages Damian Percy told The Adviser that the second tier lender had emerged from the global financial crisis in good shape, paving the way for a strong future.

"We are looking to substantially grow our business over the next 12 months, but only on a sustainable basis,"


According to Mr Percy, the second tier lender remains committed to its third party channel and will continue to look at ways it can improve servicing times.

"We consider our speed, reliability and genuine commitment to third party channels to be significant strengths at time when each of those elements are, frankly, somewhat rubbery elsewhere. We are now moving deals from application to settlement in 8 working days," he said.

"We will meet our objectives if we deliver the service and all-up value that brokers are saying they and their clients need."

But Bendigo and Adelaide Bank is not the only second tier lender looking to ramp up its presence in the mortgage market.

Suncorp has launched a new product campaign that promises to 'beat the carded rate of the big four banks' equivalent product'.

Effective from Sunday, the bank will offer a 0.20 per cent p.a. discount off its current Back to Basics carded rate, with borrowers entitled to this discount for the life of the loan.

Similarly, last month ING Direct executive director of Mortgages Lisa Claes said she expects the bank to increase mortgage lending by 20 to 25 per cent this year.

Ms Claes said now is the time for non-banks and second tier lenders to come back to the fore, as the majors will soon be forced to hold extra capital in order to meet regulatory requirements in the wake of the global financial crisis.

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