A short-term asset lender has passed the $1bn in loans written mark thanks, in part, to the quality deals consistently produced by the broker channel.
Assetline Capital achieved the milestone even with having been launched by co-founders and co-directors Nick Raphaely and Steven Beinart just seven years ago.
“The challenge for the business now is to maintain the quality of the loans. We want to continue to grow obviously, but we want to preserve what we’ve built and maintain and improve the disciplines which have enabled us to get to this point,” said Raphaely.
The co-director explained the rise of the non-bank sector has impacted the business in ways both negative and positive.
“When we started out, the non-bank space was just getting going. Today, it’s well-accepted and well-established which means more competitors are there eroding margins, eroding prices,” explained Raphaely.
Conversely, the more widespread familiarity with and acceptance of the non-bank market has brought tangible benefits to the lender.
“Investors that have been with us for a number of years have had the experience of lending money, getting it back, lending, getting it back. So there’s an acceptance of the asset class there which makes it easier to raise money," Raphaely said.
“On the borrower side, the concept of doing a deal outside of the banks is becoming more and more palatable to borrowers and to the brokers introducing the deals as well."
In fact, brokers have proven a key element of the growth strategy, with the “vast majority” of deals having originated from the channel.
“Most of our deals come from brokers. We’ve found that when a broker brings a deal, it’s better quality because they’ve sifted out the rubbish. Consumer expectations can be completely unrealistic in terms of the amount they expect to borrow or the price they can borrow at. But by the time the broker has worked with a client and comes to us, it’s generally a sensible deal,” said Raphaely.
Assetline Capital has also found success with its recent diversification into construction funding in the $5m to $20m space. According to Raphaely, it's been a "good growth area" and something that will continue to be developed in the future.
Looking ahead to the new year, the main focus for the lender will be on expanding its sales team.
“We're focused on growing our BDM network, as this has proven a successful channel for us over the years. The current push is in New South Wales and Victoria, with Queensland to follow,” explained co-director Beinart.
“The team has worked hard over many years to achieve this $1bn milestone. It would not have been possible without the support of our dedicated and passionate team, loyal investor base as well as the consistent, quality deal flow from our broker network."