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Resimac takes on Volt Bank customers

The non-bank lender bought Volt Bank’s residential loan book for $83 million, after the neobank folded earlier this year.

Resimac Group has released its annual report for 2021/22, confirming that it has acquired the residential loan book of Volt Bank for $83 million.

Its acquisition follows the neobank’s closure in June 2022, which closed its doors and handed back its licence after it was unable to raise the capital funding necessary to support the business.

Resimac did not provide further comment on the acquisition, however, said in its annual report that the acquired portfolio is a broker-originated Prime portfolio, with a weighted average LVR at origination of 61.6 per cent.

The group said it “continues to evaluate M&A opportunities in both the home loan and asset finance segments in Australia and New Zealand”.

Indeed, in August 2022, Resimac exercised the option to acquire a controlling stake in asset finance lender 23 Degrees Capital Partners Pty Ltd (operating as Sonder) for a purchase consideration of $0.9 million, increasing Resimac’s interest in 23 Degrees Capital Partners Pty Ltd to 51 per cent.

The move followed on from Resimac’s decision to take on a 15 per cent stake in the company last year.

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Under the move, Sonder Equipment Finance remains as its own brand, but will only originate Resimac Asset Finance loans.

Looking ahead, chief executive Scott McWilliam said the lender would continue to focus on specialist lending solutions, with a focus on self-employed customers who are currently “under-served by the major banks”.

“We will work closely with our broker partners to provide a compelling product and service proposition to self-employed and SME borrowers,” Mr McWilliam said.

“Asset finance is another under-served market where we see a logical and adjacent opportunity for the business.

This business is growing faster than we originally anticipated, and we expect growth to materially increase when we implement a new originations platform in 1H23.”

The company added that future technology upgrades and investments to improve the customer and broker experience were the driving force for the changes they had made and will continue to make.

“The benefits of these technology upgrades will increase as we better optimise the technology, including market-leading turnaround times to brokers and customers,” Mr McWilliam said. 

The annual report also shows that the group's home loan settlements increased by 30 per cent ($6.3 billion) over the year, partly attributed to its network of over 12,000 broker partners.

The non-bank lender's home loan portfolio has now reached more than $15 billion.

It reported net profit after tax of $102.3 million, a 5 per cent drop on last year’s profit. However, its asset portfolio grew by 11 per cent to $15.3 billion.

Chairman Warren McLeod said while its higher-risk mortgage books, such as specialist loans and small-business lending assets reported “impressive growth rates”, it was a “vastly different year” on the back of the pandemic, war in Ukraine and increasing interest rates.

“We were showing superb growth in physical assets on one hand but flat to negative growth in financial results,” he said.

[Related: Volt Bank to hand back deposits and banking licence]

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