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Brokers aggregating under Connective settled a record $98.5 billion in the financial year 2024, with commercial lending growth outpacing residential growth.
Connective brokers wrote a record volume of loans in the financial year ended 30 June, with the last quarter of the year seeing particularly strong flows.
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According to the aggregator, the 4,568 Connective brokers settled a total of $98.5 billion for the financial year, a rise of 6.9 per cent year on year (yoy).
This comprised $82 billion in residential mortgages (up 5.8 per cent yoy), $12.4 billion in commercial settlements (up 15.5 per cent yoy), and $3.9 billion in asset finance settlements (up 5.5 per cent yoy).
The aggregator said that the financial year ended particularly strongly, with Connective brokers settling $21.6 billion in the final three months of the financial year.
Lodgements also increased over FY24, with $114.8 billion in home loan applications originated by Connective brokers in FY24, up 5.5 per cent on the previous year.
According to Connective CEO Glenn Lees, the record volumes were driven by “enhanced performance” from existing brokers, the addition of new Connective brokers, and the fact that its asset finance arm expanded its lender panel.
He said that the results were particularly welcomed given the “challenging” economic conditions and reflected the value brokers provide Australian borrowers.
Lees said: “Brokers have demonstrated resilience and expertise in navigating one of the most challenging economic environments in recent history…
“At a time of increased competition, interest rate hikes and a high inflationary environment, more borrowers are recognising the importance of expert guidance to make informed decisions that are aligned with their financial goals. The results brokers have achieved demonstrate the value they offer to clients every day.”
The Connective CEO said that commercial broker volumes had grown the fastest of the three lending segments this year, adding: “Businesses are seeking finance through brokers and we’ve got a strong offering and support for our commercial brokers.
“Our track record proves that we’ve attracted high-performing commercial brokers while empowering our existing brokers to expand their offerings.”
The white label home loan portfolio, Connective Home Loans, also saw strong growth in FY24, with 54 per cent of Connective brokers writing loans through the lending arm – setting a new record. This represents a 4 per cent increase on the previous year.
Brokers settled $4.5 billion in Connective Home Loans, a 15 per cent increase yoy, while applications grew 8 per cent over the year, to $6.22 billion.
Half of the white label loan transactions were for near-prime loans, according to the aggregation group (up from 25 per cent in previous years).
Michael Goerner, the head of Connective Home Loans, said: “The past financial year was marked by a complex lending environment due to persistent inflation and rising interest rates. This placed significant financial pressure on borrowers as mortgage repayments increased and owning a home became harder.
“Brokers recognise that CHL offers the choice of products they need for every type of client. It’s our breadth of lending solutions and expert team that are driving our growth. We are providing brokers with the tools they need to efficiently serve clients and identify and access solutions across multiple lenders more quickly.”
The Connective CEO said: “Our success is driven by a combination of exceptional talent within our team and the dedication of Connective brokers.
“We remain committed to brokers – by providing industry-leading support and investing in innovative technology to equip them with the tools to exceed borrower expectations.”
The Connective results echo those issued by AFG and COG recently, which both reported record volumes in FY24 despite slower economic conditions.
[Related: Connective announces 2 key appointments]
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