Mutual lender outpaces home loan system growth

by Julia Corderoy10 Mar 2016
Leading mutual lender CUA has recorded home loan growth of almost 2% above system growth in the first half of the 2016 financial year.

CUA settled $1.5 billion in new loans in the six months ending December 2016 and achieved home loan balance growth of 9.2%, higher than the system-wide home loan growth of 7.4% over the same period.

“Achieving this growth in a challenging regulatory and economic environment is a credit to our team,” CUA Chief Executive Officer Rob Goudswaard said.

Goudswaard also highlighted the quality of its home loan growth. Home loans with a Loan to Valuation Ratio (LVR) above 90% account for less than 8% of CUA’s total home loan portfolio. 

Impairment charges were down 9.6% on the same period last year and CUA’s loan arrears are around half the rate being reported at industry level.

2015 saw CUA have a record year of new lending, however Goudswaard says the lender is on track to continue to break records.

“We are continuing to invest in improving our offering and service for customers and building capability – particularly in our loan origination system and credit cards. Significant resources and finances have been devoted to these projects to allow for a 2016 launch.

“We’ve budgeted $23 million over three years to build and implement the CUA loan origination system. This will transform the customer experience with a new digital front-end for online applications, and a simpler end-to-end process for all our products - personal loans, home loans and credit cards.”

CUA recorded a 9% increase in its first-half consolidated group net profit after tax to $28.05 million.