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Homeloans saw its total home loan settlements grow 37.5% to $2.2bn in the six months to December 2017 over the previous period on the back of a larger broker distribution network and successful lead acquisition initiatives in its direct channels.
The non-bank lender’s principally funded loan book grew 31.0% to $7.6bn. The company said yesterday (22 February) that this reflects the strong underlying momentum in the merged business of Homeloans and RESIMAC, and the supportive market conditions in the non-bank sector.
Homeloans and RESIMAC completed their integration in the first half of FY17 after announcing in July 2016 their plan to create a combined $13bn portfolio in the Australian mortgage market.
Joint CEO Scott McWilliam said the company’s result reinforces the success of its post-merger focus, which is growing its loan book by expanding its distribution networks and enhancing its customer experience and service proposition.
“Assets continue to grow ahead of market, supported by strong principally funded volumes through our broker and direct channels,” he said.
While its principally funded book saw robust growth, the non-principally funded settlements were down 20% to $0.4bn from $0.5bn in the first half of FY17.
“This has not been a conscious decision on our part as ultimately, the broker determines which product is best suited to their clients’ needs,” said Daniel Carde, general manager of third party sales.
Normalised net profit after tax stood at $12.9m, which the company said was supported by the 18.1% growth in its assets under management and growth in loan settlements across distribution channels.
Meanwhile, normalised expense to income ratio went down from 68.7% to 62.1% for the first half of FY18.
The company expects its book growth and strong settlement flows to drive its full year result. It said it remains focused on reinvesting in its business and pursuing its strategy of cost effectively growing its assets under management through third party and direct channels.
