ING Direct has been steadily offloading its funded portfolio of non-bank, white-labelled assets over the last year as it ramps up its branded home loan business.
The non-major yesterday announced a net profit after tax of $297 million for the 12 months to 31 December 2014 – an increase of 9.4 per cent on the previous year, with branded mortgages up by $2.5 billion or 7.8 per cent.
ING Direct chief executive Vaughn Richtor said the bank has been delivering on its strategy of becoming the main bank for its customers by strongly growing payment accounts, personal savings, branded mortgages and superannuation funds under management.
“To be the main bank for our customers we need to be close to the customer and therefore ING Direct branded mortgages are becoming increasingly important,” he said.
"That’s why we have been actively growing our branded mortgages while slowly reducing the significance of white-label mortgages."
The foreign-owned bank has been working with mortgage brokers for more than 15 years to build its $38.8 billion mortgage portfolio.
“The strong growth and success of our mortgage business has in large part been down to the continued support we have had from mortgage brokers,” Mr Richtor said.
“We look forward to continuing to work with mortgage brokers to further grow our branded mortgage business and to help more Australians get ahead,” he said.
In September last year, the bank sold a $1.5 billion portfolio of non-branded mortgages to Macquarie Bank, following a similar transaction in July 2014.
A source close to the situation confirmed the sale is part of the bank’s ongoing strategy to move into the core banking sector and become the primary bank to its customers.
Non-branded mortgages are no longer conducive to the bank’s customer-focused strategy, ING Direct said, signalling a move away from wholesale funding.