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AFG boosts profit by 33%

AFG boosts profit by 33%

The normalised net profit after tax at the major Australian aggregator has swelled by a stunning 33 per cent year-on-year to $30.2 million.

AFG announced its financial results for the 2017 financial year today, 25 August. AFG CEO David Bailey said: “Today’s results are a testament to AFG’s strategy of continuing to focus on our core business and growth through earnings diversification. We are very pleased with our progression down this path.

“These results have been achieved in an environment of flat credit growth and significant regulatory changes impacting foreign investment and credit appetites of Australia’s lenders.”

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FY17 saw AFG’s combined residential and commercial loan book grow by 11 per cent to $133 billion.

Within those numbers, AFG Home Loans made up 36 per cent of the group’s normalised NPAT, up from 20 per cent the prior financial year; while AFG Home Loan settlements also increased by 36 per cent to $2.6 billion and its trail book increased by 44 per cent to $5.5 billion.

The group noted that AFG Home Loans now has more than 10,000 retail customers.

As a whole, AFG’s residential portfolio grew to $126.5 billion from $114.7 billion, with 29 per cent of that held in New South Wales, 23 per cent in Victoria and Queensland apiece, 19 per cent in Western Australia and 6 per cent in South Australia.

The amount of products available to brokers has also more than doubled since April 2015, up from 1,450 to 3,400.

Mr Bailey said that the growth is the result of increased regulator scrutiny and limitations. He said: “The growth is a reflection of multiple changes by lenders to their Australian product suites. The introduction of new products, changes to LVR bands, numerous product splits with differing rates, repayment options according to loan type, and significant changes to investor and owner-occupier pricing have been rolled out across our platform in the past 12 months.

“These ongoing changes have been delivered at an unprecedented pace and reaffirm the importance to a consumer of having an informed broker.”

[Related: Mortgage Choice posts record settlements, 10% profit growth]

AFG boosts profit by 33%
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