Non-bank’s lending ‘secret weapon’

by Rebecca Pike11 Oct 2018

A non-bank lender says its growth in lending to property developers and owners during FY18 is down to a “secret weapon”.

Chifley Securities has seen a 27.5% increase in loans and attributes a major part of its growth to a specialist modelling and analytics group, Forecast Financial Modelling.

The lender adopted the group’s approach to evaluate projects with a variety of different scenarios to assess the loan’s viability.

These scenarios are based on possible changes to factors such as interest rate changes over the life of the loan.

Chifley principal, Dominic Lambrinos, said, “The creation of the multiple scenarios by Forecast has allowed us and our investors to make an informed decision in a timely manner and the ability to track its progress.”

Chifley reported its number of private lenders rose 40% to 165 during the 2018 year, with more than $2.44 billion now available for property projects across Australia.

Lambrinos said, “With an increasing number of investors, the complexity of reporting to them and gaining their approval to lend has risen but the Forecast data input and modelling has made this process very simple.

“We are seeing continuing strong lending growth in the current financial year as there is greater evidence of miss-pricing of loans to developers by new and smaller players, while the major lenders are tightening their loan criteria.”

Discussing the role of non-banks in the wake of the Royal Commission, Lambrinos added, “We expect to see stronger demand for more sophisticated and specialist non-bank finance solutions over the next year and the use of specialist suppliers like Forecast will become even more important.”

Forecast is a privately owned group with operations in Australia, UK and Europe, servicing a wide range of clients including Sky TV, Telstra and Macquarie Bank.