Non-bank lender Pepper Money has confirmed it is part of a consortium in talks to acquire the RAMS mortgage portfolio from Westpac Banking Corp, potentially marking the end of the big bank’s long-running involvement in the non-core lending brand.
In a statement to the ASX on Thursday, Pepper said it was “part of a consortium which is in negotiations with Westpac in relation to the potential transaction.” The company emphasised that talks were “preliminary and incomplete,” with “no certainty that agreement will be reached or that the transaction will eventuate.”
The discussions come as The Australian Financial Review’s Street Talk column, by Sarah Thompson, Kanika Sood, and Emma Rapaport, reported that Pepper – majority-owned by global private equity group KKR – had secured exclusivity over the $30 billion-plus portfolio and that a deal could be announced by week’s end.
Westpac had appointed Bank of America earlier this year to oversee the sale, following the closure of the RAMS franchise network in 2024 due to governance and compliance failures. The sale process initially attracted interest from Cerberus Capital Management and Apollo Global Management, which reportedly partnered with local operator ColCap Financial.
The transaction, if finalised, would represent one of the largest non-bank acquisitions in recent years, underscoring the continued investor appetite for established mortgage portfolios amid tighter credit markets.
Westpac’s divestment of the RAMS business aligns with its ongoing simplification strategy, following exits from wealth management and institutional banking operations.
The revived sale discussions emerged shortly after the Federal Court fined RAMS Financial Group $20 million for systemic breaches of the National Consumer Credit Protection Act. Between 2019 and 2023, the court found that RAMS failed to manage conflicts of interest, used unlicensed referrers, and allowed staff to falsify loan documents.
Justice Shariff described the breaches as “serious,” noting they exposed borrowers to unsuitable loans and potential hardship. ASIC deputy chair Sarah Court said the case reflected the regulator’s determination to ensure “financial entities adhere to their obligations under the law.”
Pepper Money, led by chief executive Mario Rehayem, manages a $20 billion loan book spanning residential, commercial, and asset finance. It reported a $47 million after-tax profit in the June half, supported by 22% growth in mortgage originations, according to AFR.
If the deal proceeds, Westpac would complete its full withdrawal from the RAMS brand it acquired in 2007, closing a turbulent chapter in Australian mortgage lending.
