Reduction in broker-originated volumes follows exit from Mortgage Partner business
Bendigo Bank saw a 2.3% sequential decline in residential lending in the six months to 31 December, driven by a reduction in third party-originated volumes.
Bendigo Bank attributed this to “our decision to exit the Mortgage Partner business”.
Total residential lending came to $65.1 billion in the period, with around two thirds of new settlements attributed to Bendigo Bank’s branch network and digital mortgage channels.
Despite the decline, “we remain confident that our residential lending book will return to growth over the second half of the financial year”, said managing director and chief executive Richard Fennell (pictured).
The bank saw an improvement in residential lending applications throughout the second quarter, with December marking the strongest month of its current financial year.
Business lending was up 2.8% over the six-month period.
Across the whole business, customer deposits were up 1.1% sequentially to $73.7 billion, while total funding was down 1.6% to $93.6 billion.
Bendigo Bank is in the process of rolling in Adelaide Bank customer accounts, while the onboarding of RACQ Bank's loans and deposits book is expected to increase its customer base and support residential lending growth, particularly in Queensland.
Cash earnings after tax increased 2.8% sequentially to $256.4 million, while net interest margins saw a four-basis-point increase to 1.92%.
“This result reflects good progress on our strategy over the half, with our deposit-led approach to drive sustainable loan growth gaining momentum and improving our earnings,” said Fennell.
