Login
ISCOVER
The non-bank lender has reported sustained growth in mortgage originations in its full-year results.
Non-bank lender Pepper Money has reported sustained growth in its mortgage originations during the calendar year ending 31 December 2024 (FY24).
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
In its 2024 financial results, the non-bank lender reported 5 per cent growth in mortgage originations to $4.1 billion, with originations for the second half of the year up 27 per cent compared to the first half.
Meanwhile, Pepper Money’s asset finance business saw full-year originations drop, down 13 per cent to $2.9 billion.
However, the lender said that the market was stabilising, with asset finance originations up 3 per cent during the second half of the calendar year, compared to the first half.
Overall, the non-bank lender reported a 3 per cent drop from the prior year for total originations, slipping to $7.0 billion.
Speaking exclusively to The Adviser, Pepper Money CEO Mario Rehayem said product diversification had helped fuel growth.
“We’ve seen significant growth in our self managed super fund, our commercial real estate loans, our investment and alt doc loans,” Rehayem said.
A focus on tackling mortgage broker pain points had also helped bolster originations in the mortgages space.
“Brokers are really enjoying our fast turnaround times, the consistency in our credit decisions and our very strong business development manager (BDM) network. Brokers are voting with their feet and are looking for consistency with credit decisioning and a very diversified product segment,” he said.
“What we have done as well is listen to our brokers on a number of fronts with a couple of tweaks to our credit policies [so] that [they] are more aligned to market.”
Commenting on the annual decline in asset finance originations, Rehayem said that it was partly a change of focus in response to risk.
“A lot of that [decrease] is self-imposed. We decided to pull back in some areas,” Rehayem said.
“We have a look at where the market is pricing certain products or certain risk elements and if we feel that the market is underpricing, we tend to not go down that path and try to match on price or be competitive in those areas. We will not gravitate to other lenders’ promotional campaigns in areas that we feel that risk has been mispriced.”
CEO hints at new products
Rehayem told The Adviser that Pepper Money was working on an “extensive list” of new products to be rolled out this year, which he expected would let the lender access growth across its asset finance and mortgage businesses.
As with several banks and aggregators in the space, Pepper is also leaning into automating processes on its existing products to save brokers time while adding digital features to give brokers a more frictionless experience.
Looking ahead, Rehayem said Pepper would continue to invest in broker education and actively seek their feedback.
“We’ve got a number of products that are going to fill voids in the market. We’ve got quite a number of new enhancements coming in that will improve the interaction between ourselves and our broker partners, but more importantly equipping brokers with better technology and better digital processes to enhance their service to their customers,” he said.
JOIN THE DISCUSSION