Challenging conditions to continue: Liberty 

At its 2023 annual general meeting (AGM) on Tuesday (24 October), the group forecast the continuation of difficult conditions and that it expected “subdued levels of credit growth to continue”.

Speaking at the AGM, Liberty chief executive James Boyle stated that the group expected to see “ongoing competition in residential lending while the remaining fixed rates written during the pandemic mature and while inflation continues to put pressure on disposable income”.

He also acknowledged the development of artificial intelligence tools, which he labelled could serve as an opportunity for the group to “move quickly, solve customer pain points and win favour with our products and services so we can continue helping more people get financial”.

Speaking to The Adviser, Mr Boyle added: “We’re already experimenting with the tools currently available to us and learning how we can use them to improve. We expect there will be more tools available in the near future that can help us continue to meet the changing needs of customers and deliver a positive experience.”

First quarter loan growth

At the AGM, the financial services group released its 1Q24 results – displaying growth within its overall loan portfolio, up $13.78 billion from $13.53 billion in 4Q23, despite a decline in its residential loans portfolio, down from $8.09 billion in 4Q23 to $7.98 billion.

Mr Boyle said that despite the slight decline in the residential portfolio, the decrease was slower and stated that the group was “delighted” it had been able to grow its overall portfolio during the quarter.

He stated: “Although we were able to maintain residential originations [up $732 million from $707 million in 4Q23], rather than seeing further decline, we continued to be impacted by a very competitive mortgage market leading to ongoing heightened discharges.

“As a result our residential portfolio declined, but at a slower pace than experienced over the last three quarters.”

Mr Boyle added that despite the decline, he “anticipates the residential market will improve” and that the group would see “even more customers seek our services thanks to our unique offering”.

The group’s CEO commented that the organisation’s ability to extend its portfolio growth at the overarching level would “continue to distinguish [it] from other non-banks”.

He added that the lender had “continued on its path of sound underlying performance”, which was due to the strong first quarter growth of its secured and financial services businesses.

Liberty’s secured portfolio saw the greatest growth in the first quarter, increasing from $4.73 billion in 4Q23 to $4.99 billion in 1Q24, while its financial services business increased from $613 million to $678 million in the same period.

The group attributed “continued growth in commercial and asset finance portfolios” to its secured business increase, while growth in the “personal loan portfolio” was due to “new personal loan origination from market share gain” and the reason for the financial services increase.

Liberty’s broker strategy

Mr Boyle told The Adviser that the financial services group was “invested in continuing to build strong relationships and meet the needs of our broker partners”. He stated that Liberty “consistently see[s] over 80 per cent of our originations flow through this channel and we expect this to continue”.

He added: “By diversifying our group offering to include home, car, personal, business, commercial, SMSF lending and insurance we support brokers to meet the needs of more customers and grow sustainable businesses.

“We’re committed to helping brokers to create strong, diversified businesses by providing education and hands-on BDM support.”

[Related: Liberty reports 14% drop in mortgage originations]