One of Australia’s largest regional lenders, Bendigo and Adelaide Bank, has recorded sub-par mortgage growth in the six months to 31 December 2014.
According to the regional’s first-half year results released yesterday, housing lending growth was recorded at 3.2%. This is less than half the system growth of 7.1%.
The bank’s managing director, Mike Hurst has defended the sub-par result, saying it is a solid result given the circumstances.
“... This is a solid result given the highly competitive, low-growth environment in which the Bank is operating,” he said.
“Whilst demand for housing loans is solid we are seeing an increase in customers paying down their debt across all portfolios. While this impacts the Bank's growth, it’s fantastic for our customers as they're building equity and greater financial wealth, particularly as interest rates have fallen.
“Despite this environment, we’ve strengthened our balance sheet with a strong Basel III compliant liquidity position, while our capital raising activities have been well-supported by institutional and retail investors.”
Residential mortgages make up 68.4% of the regional lender’s loan composition, according to the half-year results. Third party lending accounted for almost half (47.9%) of new residential mortgages written in the six months to December 2014. This is down slightly from June 2014 (48%), but up 1.6% from a year ago at December 2013 (46.3%).
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